FEDERAL COURT OF AUSTRALIA
Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman (The Botany Cranes Case) [2023] FCAFC 40
ORDERS
CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION First Appellant ROBERT KERA Second Appellant MICHAEL GREENFIELD (and others named in the Schedule) Third Appellant | ||
AND: | Respondent | |
DATE OF ORDER: |
THE COURT ORDERS THAT:
1. The appeal be allowed.
2. Paragraphs 15, 16(a), 16(b), 16(d), 17, 18, 19(a), 19(c), 19(d), 20, 21, 22 and 23 of the orders made by the primary judge on 19 May 2021 be set aside and in lieu thereof it be ordered that:
(a) within 28 days of these orders, the First Appellant (CFMMEU) pay to the Commonwealth of Australia a pecuniary penalty of:
(i) $190,000 for its contravention of s 47(1) of the Building and Construction Industry (Improving Productivity) Act 2016 (Cth) (BCIIP Act) on 25 January 2019; and
(ii) $150,000 for its contravention of s 54 of the BCIIP Act on 31 January 2019 and 1 February 2019.
(b) within 90 days of these orders, the Second Appellant (Mr Kera) pay to the Commonwealth of Australia a pecuniary penalty of $35,000 for his contravention of s 47(1) of the BCIIP Act on 25 January 2019.
(c) within 90 days of these orders, the Third Appellant (Mr Michael Greenfield) pay to the Commonwealth of Australia a pecuniary penalty of:
(i) $25,000 for his contravention of s 47(1) of the BCIIP Act on 25 January 2019; and
(ii) $18,000 for his contravention of s 54 of the BCIIP Act on 31 January 2019 and 1 February 2019.
(d) within 90 days of these orders, the Fourth Appellant (Ms Mallia) pay to the Commonwealth of Australia a pecuniary penalty of $15,000 for her contravention of s 47(1) of the BCIIP Act on 25 January 2019.
(e) within 90 days of these orders, the Fifth Appellant (Mr Byrnes) pay to the Commonwealth of Australia a pecuniary penalty of $3,500 for his contravention of s 47(1) of the BCIIP Act on 25 January 2019.
(f) each of the pecuniary penalties required to be paid by Mr Kera, Mr Michael Greenfield and Ms Mallia by these orders, shall be paid by that person personally in that he or she shall not, whether before or after the payment of the penalty:
(i) seek to have or encourage the CFMMEU in any way whatsoever, directly or indirectly, to pay him or her or for his or her financial benefit in any way whatsoever, any money or financial benefit referable to the payment of the penalties, whether in whole or in part; and
(ii) accept or receive from the CFMMEU in any way whatsoever, directly or indirectly, any money or financial benefit referable to the payment of the penalties, whether in whole or in part.
3. Within seven days of these orders, each party file and serve a written submission (of no more than three pages) on costs.
4. Within 14 days of these orders, each party file and serve any responding written submission (of no more than two pages) on costs.
5. Subject to further order, the issue of costs be dealt with on the papers.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Introduction
1 This is an appeal by one union respondent and four individual respondents from orders made by a Judge of this Court imposing penalties for contraventions of ss 47, 52 and 54 of the Building and Construction Industry (Improving Productivity) Act 2016 (Cth) (the Act). The contraventions involved or related to:
(a) an unlawful picket and coercive action on 25 January 2019 (in contravention of ss 47 and 52);
(b) threatening to organise or take action with intent to coerce on 30 January 2019 (in contravention of s 52); and
(c) organising or taking of action with intent to apply undue pressure over a two-day period from 31 January 2019 to 1 February 2019 (in contravention of s 54).
2 The declarations of contravention made by the primary judge in relation to those three events were agreed and are not the subject of this appeal. The appeal is confined to the penalties imposed and a related order that the union not indemnify one of the individual respondents.
3 The original applicant and the original respondent to this appeal was the Australian Building and Construction Commissioner. The Fair Work Ombudsman was substituted as the respondent to the appeal consequent upon the abolition of the Australian Building and Construction Commission by the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) with effect from 7 December 2022, after the hearing of the appeal. It is convenient to continue to refer to the respondent as the Commissioner. The first respondent below, now the first appellant, is the Construction, Forestry, Maritime, Mining and Energy Union (the Union or the CFMMEU). The remaining four respondents below, now the second to fifth appellants, are all Union members and officials – three are employees and office holders, and one is a delegate of the Union.
4 The unlawful conduct admitted to have taken place was directed against Griffiths Cranes Pty Ltd, trading as Botany Cranes, on 25 January 2019, 30 January 2019, and 31 January 2019 to 1 February 2019. Botany Cranes is a supplier of mobile cranes and mobile crane hire services in New South Wales for residential and commercial construction sites. During January and February 2019, it had contracts with its customers to provide mobile cranes.
5 Botany Cranes had premises, including a yard, in Hale Street, Botany in Sydney where it conducted its operations. This included storing, servicing and maintaining mobile cranes and doing other building-related work. Botany Cranes’s employees received information about who was to take mobile cranes from the premises for each day’s work on construction sites. The ambit of the contraventions admitted to was arrived at following mediation which resulted in the number of respondents, contraventions alleged and declarations sought being significantly reduced.
6 The original case was brought against the Union and 12 officials, but was discontinued against eight of those officials. The number of contraventions alleged went from 80 to 20. The remaining four officials against whom the case was maintained and who bring this appeal along with the Union are:
(a) Mr Robert Kera and Mr Michael Greenfield, each employees and members of the Union and assistant secretaries of the New South Wales Divisional Branch of the Union and members of its committee of management; in these reasons, we will refer to “Michael Greenfield” using his first name to distinguish him from Darren Greenfield, who was also one of the original respondents below;
(b) Ms Rita Mallia, an employee and member of the Union and president of the Branch and a member of its committee of management; and
(c) Mr Howard Byrnes, a member of, and agent of, the Union, and its delegate at Botany Cranes, who performed the function of dealing with that company.
7 The evidence at the penalty hearing before the primary judge was limited to a detailed statement of agreed facts and admissions (the SOAF) and limited affidavit evidence by which certain records were produced. The agreed facts also included three video clips recorded early on 25 January 2019:
(a) video footage taken by a New South Wales Police Force (NSW Police Force) body camera;
(b) a video of Mr Byrnes’s speech to the picketers and some of his use of a megaphone; and
(c) a video of an interview with Mr Byrnes at the site during the picket.
8 Agreement was reached as to the fact of contraventions having taken place on each day, but not the number of contraventions by the Union by reason of the conduct and state of mind of the four officials attributed to it by ss 94 and 95 of the Act.
9 The primary judge delivered two sets of reasons for judgment that are relevant for present purposes: Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (No 3) (The Botany Cranes Case) [2021] FCA 363 (the First Reasons); and Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Botany Cranes Case) (No 4) [2021] FCA 525 (the Second Reasons). On 19 May 2021, the primary judge made declarations of contravention and orders in relation to penalty. The primary judge imposed the following penalties on the officials and the Union:
(a) In relation to the contraventions of ss 47 and 52 on 25 January 2019:
(i) penalties totalling $47,500 were imposed on Mr Kera;
(ii) penalties totalling $35,000 were imposed on Michael Greenfield;
(iii) penalties totalling $20,000 were imposed on Ms Mallia;
(iv) penalties totalling $5,000 were imposed on Mr Byrnes; and
(v) a penalty of $500,000 was imposed on the Union.
(b) In relation to the contraventions of s 52 on 30 January 2019:
(i) a penalty of $30,000 was imposed on Michael Greenfield; and
(ii) a penalty of $175,000 was imposed on the Union.
(c) In relation to the contraventions of s 54 on 31 January and 1 February 2019:
(i) a penalty of $35,000 was imposed on Michael Greenfield; and
(ii) a penalty of $175,000 was imposed on the Union.
10 By their amended notice of appeal, the appellants appeal from paragraphs 15-19 and 23 of the 19 May 2021 orders, being the orders imposing penalties on the appellants (paragraphs 15-19) and an ancillary order relating to the penalty payable by Mr Byrnes (paragraph 23). The appeal raises issues concerning the construction and application of the provisions of the Act concerning the imposition of penalties. In particular, in relation to the contraventions of ss 47 and 52 on 25 January 2019, the appeal raises the following issues:
(a) whether, in circumstances where the four officials engaged in a single unlawful picket in contravention of s 47, and their conduct is taken to have been engaged in also by the Union, the Union committed four contraventions of s 47 (as the primary judge held) or one contravention of s 47;
(b) whether, in circumstances where the four officials took action with intent to coerce in contravention of s 52, and their conduct is taken to have been engaged in also by the Union, the Union committed four contraventions of s 52 (as the primary judge held) or one contravention of s 52;
(c) whether, in relation to the contraventions of ss 47 and 52 that occurred on 25 January 2019, the officials and the Union are liable for more than one pecuniary penalty (as the primary judge held) or only one pecuniary penalty.
11 For the reasons that follow, we consider that the primary judge erred in his construction and application of these provisions in relation to the contraventions of ss 47 and 52 on 25 January 2019. Accordingly, the penalties imposed by the primary judge in relation to those contraventions need to be set aside.
12 We also conclude that the primary judge erred in imposing penalties for the contraventions of s 54 of the Act that took place on 31 January to 1 February 2019 on the basis that there was a state of mind tantamount to intention to coerce, as distinct from a state of mind of intending to apply undue pressure. While, conceptually, there can be cases in which both states of mind are established or there is no actual distinction between the two states of mind, on the facts as agreed or proven, Michael Greenfield, and thereby the Union, admitted only to the latter state of mind. His Honour imposed penalties on a basis that went beyond the state of mind that had been agreed to or proven. Accordingly, the penalties for those contraventions also need to be set aside.
13 The parties accepted that, if and to the extent that the appeal were successful, it would be appropriate for the Full Court to re-exercise the discretion to impose penalties (rather than this aspect being remitted). We have, therefore, re-exercised the discretion to impose penalties in relation to the relevant contraventions.
Background and issues raised on appeal
The period before 25 January 2019
14 From 2012, an enterprise agreement had covered Botany Cranes, its employees and the Union, with a nominal expiry date of 31 May 2015. In about February 2018, the Union began negotiating with Botany Cranes on behalf of its members who were employees with a view to arriving at terms for a replacement enterprise agreement. The Union provided Botany Cranes with its terms for a proposed enterprise agreement in February 2018. In about July 2018, the Union provided Botany Cranes with a further version of its proposed enterprise agreement (proposed Union EBA). The managing director of Botany Cranes, Mr Damian Griffiths, did not agree to or accept the proposed EBA.
15 Other relevant employees of Botany Cranes included Ms Rhonda Hodges, operations manager, Mr Paul Hall, a mechanic, and Ms Tara Canin, a receptionist.
16 In August 2018, Botany Cranes provided a copy of its proposed enterprise agreement to the Union.
17 Botany Cranes’s employees voted to approve the proposed Union EBA on 23 August 2018. Botany Cranes’s non-acceptance of the proposed Union EBA was one of two industrial issues relevant to aspects of the contravening conduct.
18 By 24 January 2019, Mr Griffiths had formed the view that Mr Byrnes was providing advance information to the Union about the location of sites at which Botany Cranes’s cranes were being used, thereby assisting the Union to interfere with its business. At about 1.00 pm that day, Mr Griffiths met with Mr Byrnes and told him that someone was tipping off the Union, to which Mr Byrnes responded with words to the effect “Maybe sign the EBA and it will stop”. Later that day, Mr Griffiths, not believing Mr Byrnes’s denial that he was sabotaging the business, terminated his employment with immediate effect. That termination was the second industrial issue relevant to aspects of the contravening conduct.
25 January 2019
19 After the termination of Mr Byrnes’s employment on 24 January 2019, the Union circulated a text message to all its members, including Botany Cranes’s employees, calling upon them to attend the yard at Hale Street, Botany, to protest against that termination. A picket took place from about 5.30 am, with a group of about 50 members being assembled by about 6.45 am, with some, including Mr Kera, Michael Greenfield and Ms Mallia, wearing Union branded clothing. There was also present some 15 Union flags or banners. Some of the group blocked access to the yard. The group was addressed by each of Mr Kera, Michael Greenfield, Ms Mallia and Mr Byrnes as set out in the SOAF. Mr Kera was identified as being in charge. A number of NSW Police attended from 6.00 am. The bulk of the activity took place before about 9.00 am, but the picket continued with some members of the group until about 4.00 pm.
20 By the SOAF, Mr Kera, Michael Greenfield, Ms Mallia, Mr Byrnes and the Union admitted that the actions of those individuals, in participating in the activities of the group on 25 January 2019:
(a) constituted engaging in (and in the case of Michael Greenfield, organising) an unlawful picket contrary to s 47 of the Act in that their actions:
(i) had the purpose of preventing or restricting persons from accessing or leaving the Botany Cranes yard;
(ii) prevented Mr Hall and persons driving cranes from leaving the Botany Cranes yard, and restricted persons from accessing or leaving the Botany Cranes yard;
(iii) would reasonably be expected to intimidate persons accessing or leaving the Botany Cranes yard;
(iv) were motivated by the purpose of supporting or advancing claims against Botany Cranes in respect of employment of employees by Botany Cranes; or
(v) were motivated by the purpose of advancing industrial objectives of the Union, namely, the claim to reinstate Mr Byrnes to his employment, and the securing of Botany Cranes’s agreement to the proposed Union EBA;
(b) by reason of ss 94(1)(a) and 95(1)(b) of the Act, was the conduct and actions of the Union, which thereby contravened s 47 of the Act;
(c) constituted the taking of action against Botany Cranes with intent to coerce it to employ Mr Byrnes as a building employee, that was unlawful, and contravened s 52 of the Act;
(d) for the purposes of “coercion” within the meaning of s 52, was unlawful in that it constituted an unlawful picket in contravention of s 47 of the Act; and
(e) by reason of ss 94(1)(a) and 95(1)(b) of the Act, was the conduct and actions of the Union, which thereby contravened s 52 of the Act.
21 It is convenient at this point to set out the text of ss 47 and 52 of the Act. In these reasons, all provisions of the Act are set out as they stood at the time of the contraventions, which all took place in the period from 25 January 2019 to 1 February 2019. Sections 47 and 52 relevantly provided:
47 Unlawful picketing prohibited
(1) A person must not organise or engage in an unlawful picket.
Note: Grade A civil penalty.
(2) An unlawful picket is action:
(a) that:
(i) has the purpose of preventing or restricting a person from accessing or leaving a building site or an ancillary site; or
(ii) directly prevents or restricts a person accessing or leaving a building site or an ancillary site; or
(iii) would reasonably be expected to intimidate a person accessing or leaving a building site or an ancillary site; and
(b) that:
(i) is motivated for the purpose of supporting or advancing claims against a building industry participant in respect of the employment of employees or the engagement of contractors by the building industry participant; or
(ii) is motivated for the purpose of advancing industrial objectives of a building association; or
(iii) is unlawful (apart from this section).
Note: See also Division 2 of Part 2 of Chapter 6 (reason for action and coercion)
…
52 Coercion relating to allocation of duties etc. to particular person
A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person, or a third person, to:
(a) employ, or not employ, a particular person as a building employee; or
…
Note 2: Grade A civil penalty
22 It is also convenient to set out ss 94(1)(a) and 95(1)(b) of the Act, which provided:
94 Liability of bodies corporate
Conduct of a body corporate
(1) Any conduct engaged in on behalf of a body corporate:
(a) by an officer, employee or agent (an official) of the body within the scope of his or her actual or apparent authority; or
(b) …
is taken, for the purposes of this Act, to have been engaged in also by the body.
…
95 Actions of building associations
(1) For the purposes of this Act, each of the following is taken to be action of a building association:
(a) …
(b) action taken by an officer or agent of the building association acting in that capacity; …
We note that s 95 has since been repealed by the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act.
23 There was no dispute that each of Mr Kera, Michael Greenfield, Ms Mallia and Mr Byrnes contravened both ss 47(1) and 52(a) on 25 January 2019, making a total of eight contraventions. The Commissioner contended that this translated into eight corresponding contraventions by the Union. The appellants contended that the Union contravened s 47(1) once and contravened s 52(a) once, and further that the Union was liable for only one penalty for those two related contraventions because of the operation of s 83(2) of the Act (set out later in these reasons).
24 The primary judge acceded to the Commissioner’s argument, imposing penalties as follows in relation to the contraventions on 25 January 2019:
Mr Kera | $12,500 for the s 47(1) contravention $35,000 for the s 52(a) contravention |
Michael Greenfield | $10,000 for the s 47(1) contravention $25,000 for the s 52(a) contravention |
Ms Mallia | $5,000 for the s 47(1) contravention $15,000 for the s 52(a) contravention |
Mr Byrnes | $1,500 for the s 47(1) contravention $3,500 for the s 52(a) contravention |
Union | $500,000 for its eight contraventions by the attributed conduct of the four officers above |
25 Each penalty was payable to the Commonwealth, save that the primary judge ordered that of the $500,000 penalty payable by the Union, $30,000 was to be paid to Botany Cranes, $2,500 to Ms Hodges, and $15,000 to the NSW Police Force (a total of $47,500).
26 By grounds 1 to 4 of the amended notice of appeal, the Union appeals against the penalties imposed upon it for the contraventions on 25 January 2019, contending that there should have been a finding of one contravention by it of s 47(1) and one contravention by it of s 52(a).
27 By grounds 6 to 13, all of the appellants appeal against penalties imposed for contraventions of both ss 47(1) and 52(a). The Commissioner relies upon a notice of contention to defend the penalties imposed even if it is found that the primary judge erred.
28 By ground 21, Ms Mallia appeals against the penalty imposed upon her upon the basis that the primary judge attributed to her the contravening culture of the Union without the evidence necessary to support that conclusion.
30 January 2019
29 A further picket took place at the Botany Cranes yard on 30 January 2019 from about 5.00 am until about 7.30 am. Again, a group assembled (the number involved is not agreed in the SOAF), including Michael Greenfield. Members of the group, including Michael Greenfield, wore Union branded clothing and again there were some 15 Union flags or banners. A conversation took place between Michael Greenfield and Mr Griffiths about reinstating Mr Byrnes.
30 At about 6.00 am a further meeting and conversation took place between Mr Kera, Michael Greenfield, Mr Griffiths and Mr Jason Peterson (a dogman and Union member employed by Botany Cranes) about reinstating Mr Byrnes. The burden of the conversation was that the protest would stop if Mr Byrnes was reinstated.
31 By the SOAF, Michael Greenfield and the Union admitted that:
(a) Michael Greenfield’s conduct on 30 January 2019 constituted threatening to organise or take action against Botany Cranes with intent to coerce it to employ Mr Byrnes as a building employee, that was unlawful, illegitimate or unconscionable, and thereby contravened s 52 of the Act;
(b) for the purposes of “coercion” within the meaning of s 52, the conduct of Michael Greenfield was an unlawful threat to interfere with Botany Cranes’s contractual relations with its employees and contractors, was illegitimate and unconscionable in that it was adverse and prejudicial to Botany Cranes in threatening to prevent its employees from working using its mobile cranes to carry out work on 30 January 2019 and threatened to cause Botany Cranes to lose revenue and profit, and was disproportionate to any legitimate interest the threat supported, and which none of Michael Greenfield or the Union had any entitlement to make or carry out; and
(c) the conduct and actions of Michael Greenfield on 30 January 2019, by reason of ss 94(1)(a) and 95(1)(b) of the Act, was the conduct and actions of the Union, which thereby contravened s 52.
32 There was no dispute that Michael Greenfield contravened s 52(a) on 30 January 2019, nor that the Union also contravened that provision by reason of his conduct. The primary judge imposed a penalty of $30,000 on Michael Greenfield and a penalty of $175,000 on the Union. No separate appeal is brought against those penalties, save as to the overall cooperation discount referred to below, via grounds 25 to 27.
31 January 2019 and 1 February 2019
33 At 6.00 am on 31 January 2019, and at about 6.55 am on 1 February 2019, Mr Kera and Michael Greenfield met with Botany Cranes employees outside the yard gate. Michael Greenfield had a conversation with Mr Griffiths on both those days directed to getting Botany Cranes to accept the proposed Union EBA, making threats if that did not happen on the first of those days and promising the end of Union action if that did happen on the second of those days.
34 On 12 February 2019, Mr Griffiths signed the proposed Union EBA on behalf of Botany Cranes.
35 By the SOAF, Michael Greenfield and the Union admitted that:
(a) the conduct of Michael Greenfield on 31 January 2019 and 1 February 2019 constituted the organising or taking of action against Botany Cranes, with intent to apply undue pressure to Botany Cranes to agree to make or approve a building enterprise agreement, that was unlawful, illegitimate or unconscionable, and contravened s 54(1) of the Act;
(b) the conduct and actions of Michael Greenfield on 31 January 2019 and 1 February 2019, by reason of ss 94(1)(a) and 95(1)(b) of the Act, was the conduct and actions of the Union, which thereby contravened s 54(1).
36 Section 54 of the Act relevantly provided:
54 Coercion of persons to make, vary, terminate etc. enterprise agreements etc.
(1) A person must not:
(a) organise or take, or threaten to organise or take, any action; or
(b) refrain, or threaten to refrain, from taking any action;
with intent to coerce another person, or with intent to apply undue pressure to another person, to agree, or not to agree:
(c) to make, vary or terminate a building enterprise agreement; or
(d) to approve any of the things mentioned in paragraph (c).
Note 1: See also Division 2 (reason for action and coercion).
Note 2: Grade A civil penalty.
37 There was no dispute that Michael Greenfield contravened s 54(1) on 31 January 2019 to 1 February 2019, nor that the Union also contravened that provision by reason of his conduct. The primary judge imposed a penalty of $35,000 on Michael Greenfield and a penalty of $175,000 on the Union.
38 Michael Greenfield and the Union appeal against those penalties. In summary, they make the following contentions:
(a) by grounds 14-16 of the amended notice of appeal, they contend that the penalties were imposed not only upon the basis of the admitted contravention (applying undue pressure as proscribed by s 54(1)), but also upon a more serious basis that was not pleaded or admitted, namely intention to coerce; further, they contend that there was no evidence of Michael Greenfield making, as found, “overbearing threats”; this is sought to be countered by the Commissioner’s notice of contention to the effect that, even if this error did occur, the penalties were nonetheless open to be imposed in the exercise of the penalty discretion;
(b) by ground 22, they contend that there was no evidence that the contravening conduct was, as found by the primary judge, motivated by a desire by the Union not to run the risk of losing its appeal to the Full Bench of the Fair Work Commission regarding approval of the proposed Union EBA; and
(c) by ground 28, they contend that the primary judge failed to take into account, as a mandatory relevant consideration under s 81(6)(b), that no loss or damage was suffered by Botany Cranes.
Cooperation discount
39 In the course of imposing the penalties summarised above, the primary judge found as follows in relation to the co-operation by the appellants at [114]:
The Union is well-resourced and financially substantial, as is the branch. In pecuniary penalty proceedings, the Union frequently does what occurred in this proceeding; namely, agree facts so that the Court can impose penalties without requiring witnesses, including not only the persons adversely affected by contravening conduct but also the officials and members of the Union who engaged in that conduct, to give evidence. I accept that this has a benefit in avoiding the persons affected by the contravening conduct from having to give evidence in Court. But, in this case, that benefit occurred only after extensive interlocutory processes, in circumstances where, as the agreed facts, including the subpoenaed police video, revealed, there was no real prospect of a defence to the allegations of the contraventions on 25 January 2019, except perhaps as to the identity of the organiser, given what appeared to be Mr Kera’s role.
40 By grounds 25 to 27, the appellants contend that the primary judge erred in this assessment of their co-operation by failing to take into account the public benefits of admissions and co-operation, by taking into account an irrelevant consideration that there was no real prospect of a defence to the 25 January 2019 contraventions, and by failing to take into account as a relevant consideration that the resolution of the contraventions post-25 January 2019 were not the subject of police video or other objective evidence.
Personal payment orders
41 Additionally, the primary judge ordered that all of the penalties ordered to be paid by Mr Kera and Ms Mallia, $65,000 of the penalties to be paid by Michael Greenfield, and $3,500 of the penalties to be paid by Mr Byrnes, be paid by them personally without seeking or accepting any contribution by the Union. In the case of Mr Byrnes, this order was not sought by the Commissioner.
42 By grounds 37, 38 and 40, Mr Byrnes appeals against that order upon the basis that: (a) the Commissioner had not sought it and had submitted it was not appropriate; (b) the primary judge failed to take into account as a relevant consideration the public interest in promoting the predictability of outcomes in civil penalty proceedings; and (c) the primary judge erred in concluding that there was no prejudice to Mr Byrnes in imposing a non-indemnification order in circumstances where it had serious practical and legal consequences, he had agreed to resolve the proceeding on the basis that no such order was sought against him and, if such an order had been sought, it may have influenced his conduct of the proceeding.
Abandoned appeal grounds
43 For completeness, it should be noted that the appellants, by their amended notice of appeal, expressly abandoned grounds 5, 17 to 20, 23, 24 and 29 to 36. Further, at the appeal hearing, the appellants abandoned ground 39.
Grounds 1 to 4
44 These grounds of appeal relate to the conclusion of the primary judge that, in respect of the events on 25 January 2019, the Union committed four contraventions of s 47(1) and four contraventions of s 52(a) of the Act. By grounds 1 to 4, the Union contends, in summary, that the primary judge erred and that his Honour should have held that the Union committed only one contravention of s 47(1) and one contravention of s 52(a). It is not necessary to set out the text of these grounds.
45 These grounds of appeal turn on the correct construction and application of ss 94 and 95 of the Act. Although parts of those provisions have been set out above, we now set out those sections in full to provide context for the discussion that follows:
94 Liability of bodies corporate
Conduct of a body corporate
(1) Any conduct engaged in on behalf of a body corporate:
(a) by an officer, employee or agent (an official) of the body within the scope of his or her actual or apparent authority; or
(b) by any other person at the direction or with the consent or agreement (whether express or implied) of an official of the body, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the official;
is taken, for the purposes of this Act, to have been engaged in also by the body.
State of mind of a body corporate
(2) If, for the purposes of this Act, it is necessary to establish the state of mind of a body corporate in relation to particular conduct, it is enough to show:
(a) that the conduct was engaged in by a person referred to in paragraph (1)(a) or (b); and
(b) that the person had that state of mind.
Meaning of state of mind
(3) The state of mind of a person includes:
(a) the knowledge, intention, opinion, belief or purpose of the person; and
(b) the person’s reasons for the intention, opinion, belief or purpose.
95 Actions of building associations
(1) For the purposes of this Act, each of the following is taken to be action of a building association:
(a) action taken by the committee of management of the building association;
(b) action taken by an officer or agent of the building association acting in that capacity;
(c) action taken by a member, or group of members, of the building association if the action is authorised by:
(i) the rules of the association; or
(ii) the committee of management of the association; or
(iii) an officer or agent of the association acting in that capacity;
(d) action taken by a member of the building association who performs the function of dealing with an employer on behalf of the member and other members of the association, acting in that capacity;
(e) if the building association is an unincorporated building association that does not have a committee of management—action taken by a member, or group of members, of the association.
(2) Paragraphs (1)(c) and (d) do not apply if:
(a) the committee of management of the building association; or
(b) a person authorised by the committee; or
(c) an officer of the building association;
has taken all reasonable steps to prevent the action.
(3) If, for the purposes of this Act, it is necessary to establish the state of mind of a building association in relation to particular action, it is enough to show:
(a) that the action was taken by a person, or a group, referred to in any of paragraphs (1)(a) to (e); and
(b) that the person, or a person in the group, had that state of mind.
(4) Subsections (1) to (3) have effect despite subsections 94(1) and (2) (liabilities of bodies corporate).
46 The parts of the above provisions of principal relevance are ss 94(1)(a) and 95(1)(b), these being the parts relied on in the SOAF as the basis for attributing the conduct of the officials on 25 January 2019 to the Union.
The primary judge’s reasons
47 At [20] of the First Reasons, the primary judge noted (relevantly for present purposes) that the parties agreed that the Union contravened ss 47(1) and 52(a) of the Act on 25 January 2019, but were in dispute as to how many contraventions of those provisions it committed. His Honour noted that the Commissioner asserted that the conduct of each of the officials constituted a separate contravention by the Union, while the Union contended that there was only one unlawful picket and one act of coercion; that is, only one contravention of s 47(1) and only one contravention of s 52(a) by the Union. To the extent that his Honour discussed the issue of whether the Union could be liable for only one penalty, we discuss that aspect of his Honour’s reasons in the context of considering grounds 6 to 13 of the amended notice of appeal. The grounds we are presently considering – grounds 1 to 4 – are concerned with the number of contraventions committed by the Union.
48 At [21], the primary judge summarised the Commissioner’s pleaded allegations in relation to the events of 25 January 2019, which were to the effect that each contravention by an official led to a separate contravention by the Union.
49 After setting out the parties’ submissions, the primary judge stated, at [35], that it was important to analyse the contraventions of each of the officials on 25 January 2019 to ascertain whether the Union engaged in a single contravention of each of ss 47(1) and 52(a) or in multiple contraventions. His Honour, at [35]-[38], summarised the conduct of each of the officials on 25 January 2019 as set out in the SOAF.
50 The primary judge considered the construction of ss 94 and 95 at [42]-[50] of the First Reasons. The primary judge recognised, at [43], that the purpose of s 94 is to facilitate proof of liability of the body corporate as a principal for any conduct engaged in on its behalf by an individual with the relevant characteristics. At [44], his Honour referred to Hamilton v Whitehead [1988] HCA 65; 166 CLR 121 at 126-129 per Mason CJ, Wilson and Toohey JJ, and Mallan v Lee [1949] HCA 48; 80 CLR 198 at 215-216 per Dixon J, and the distinction between statutory provisions that impose liability directly on both an officer of a body corporate and the body for the same conduct, on the one hand, and on the officer as an accessory to the conduct in which he or she caused the body to engage, on the other. The primary judge stated at [45]:
It follows that, where conduct of an individual, to which s 94 applies, constitutes a contravention of the Act, ipso facto, the body corporate will also contravene in the same way and by the same conduct as that individual: Mallan 80 CLR at 215–216; Whitehead 166 CLR at 126–127.
51 The primary judge considered, at [49]-[50], the judgment of the Full Court in Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner (The Bay Street Appeal) [2020] FCAFC 192; 282 FCR 1. The primary judge noted, at [50], that in that case, “[i]mportantly, White J recognised that, in any particular situation, it is possible that more than one unlawful act by a body corporate can have occurred through the statutory agency created by the deeming of conduct and actions of one or more individuals within an overall event to be that of the body, and that this can be alleged and proved”.
52 At [64]-[78], the primary judge considered the conduct of the officials on 25 January 2019. Although this part of the reasons is not directly relevant for grounds 1 to 4 (which concern the number of contraventions by the Union), we note that the primary judge emphasised the distinct aspects of the conduct of the officials as set out in the SOAF: see, eg, [66], [67].
53 The primary judge considered the Union’s conduct on 25 January 2019, and the characterisation of that conduct, at [79]-[93]. These sections of the First Reasons include discussion of two issues: first, the number of contraventions committed by the Union; and secondly, whether the Union was liable for more than one penalty. Grounds 1 to 4 of the amended notice of appeal relate to the first issue, while grounds 6 to 13 (discussed later in these reasons) relate to the second issue. In relation to the number of contraventions, his Honour rejected the Union’s argument that it committed only one contravention of each of ss 47(1) and 52(a): at [80]. His Honour held, in essence, that, by reason of the conduct of each official being taken to be the conduct of the Union, and the conduct of each official being distinct or separate, the Union committed four contraventions of s 47(1) and four contraventions of s 52(a): at [80], [82], [155]. His Honour noted that the overlapping elements of the conduct would be relevant to the amount of any penalty to be imposed: at [81], [82].
54 When it came to fixing a penalty for the Union’s contraventions, the primary judge approached the matter on the basis that the Union had committed four contraventions of s 47(1) and four contraventions of s 52(a), making a total of eight contraventions. His Honour stated that the maximum penalty for the Union’s conduct on 25 January 2019 was $1.68 million (see [160]). That figure represents eight times the maximum penalty for a single contravention of those provisions (which is $210,000). Although taking into account the degree of overlap, it was in this context that his Honour arrived at a single penalty of $500,000 for the Union’s contraventions of ss 47(1) and 52(a) on 25 January 2019.
The parties’ submissions
55 The Union submits that his Honour’s analysis failed to properly assess the conduct attributed to the Union and the elements of the contraventions of ss 47(1) and 52(a) admitted in the SOAF: see Director of the Fair Work Building Industry Inspectorate v Robinson [2016] FCA 525; 241 FCR 338 at [48]-[50]. The Union submits that his Honour’s reasoning was tantamount to applying ss 94 and 95 (wrongly) as attributing liability to a body corporate for the contraventions of its employees, agents and officers.
56 The Union submits that: s 47(1) proscribes organising or engaging in an “unlawful picket” by a “person”; an unlawful picket is committed if the factual and state of mind elements detailed in s 47(2) are satisfied, namely, that a person engages in action that either has a particular purpose, brings about a particular result or which is of a particular character; that action must also either have a particular industrial purpose or otherwise be unlawful; an “unlawful picket” as contemplated by s 47 is necessarily a collective effort and connotes a body of persons stationed in front of a workplace or other premises who are engaged in attempting to dissuade or prevent persons entering the premises (Sid Ross Agency Pty Ltd v Actors and Announcers Equity Association of Australia [1971] 1 NSWLR 760 at 767, 768; Davids Distribution Pty Ltd v National Union of Workers [1999] FCA 1108; 91 FCR 463 at [69]; Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Kiama Aged Care Centre Case) [2021] FCA 920; 309 IR 353 at [375]-[382]); whether a body corporate organises and engages in one or more unlawful pickets must be considered in light of these matters of statutory context and the nature of pickets that are contemplated to fall within s 47(1).
57 The Union submits that: in the present matter, there was a single picket on 25 January 2019; the single picket is described in [26]-[34] of the SOAF; that description makes clear that the actions of the group, which included the individual appellants, constituted the engaging in (and in Michael Greenfield’s case, the organising of) the single picket; it was a single continuous event which occurred at one time and in one place and it had one beginning and one end; the Commissioner pleaded it as a single picket constituted by approximately 30 persons; the Union as a body corporate did not organise and engage in multiple unlawful pickets; rather, by the conduct and actions of the individual appellants and the other persons who formed the group of picketers that assembled outside the yard, it organised and engaged in a single picket.
58 In response, the Commissioner submits that: it is not correct that an unlawful picket must necessarily be constituted by a collective group; the reference given by the Union to Davids Distribution does not support the Union’s contention; in Broome v Director of Public Prosecutions [1974] AC 587, a picket was found to have been engaged in by one person; the relevant legislation referred to “one or more persons” as constituting a picket, just as “person” in the Act could be interpreted to include “persons”; but that does not exclude a picket being constituted by one person; s 47(2) has its own definition of an unlawful picket; that definition does not stipulate that it cannot be constituted by one person; the “statutory context” and “the nature of pickets” do not assist the Union.
59 The Commissioner submits that: the prohibited conduct under s 47 is engaging in or organising an unlawful picket; when alleged against individuals, those are necessarily individual activities; it is not necessary to allege that multiple pickets were “mounted” by each individual appellants; indeed, it would be insufficient to invoke the application of s 47(1); that submission in fact presumes a picket could be one person, contrary to the Union’s submission that it must be collective.
60 The Commissioner submits that: the Union can gain no assistance from the pleadings or the SOAF; the amended statement of claim and the further amended originating application clearly pleaded that each of the individual appellants engaged in (and in Michael Greenfield’s case, organised) an unlawful picket under s 47 and, separately, each of them took action in contravention of s 52, and that in relation to those individual contraventions, the Union was liable and committed more than one contravention; the primary judge accepted that the pleading characterised the contraventions as qualitatively distinct; the identification of the separate engagement of each of the individual appellants is repeated in the SOAF at [37]-[39] and [41]; the parties by agreement deliberately left the issue of how many contraventions were committed by the Union to be dealt with in submissions at the penalty hearing.
61 The Commissioner submits that: in both Robinson (at [53]) and the Bay Street Appeal (at [258]-[259]) the conclusion that only one penalty should be imposed on the union occurred in circumstances where the pleading and the judge’s factual findings were to the effect that one stoppage of work was organised, albeit by more than one official; in Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The Constitution Place Case) [2020] FCA 1070; 299 IR 231 at [79], Katzmann J expressed doubt that Robinson would have been so decided if it involved engagement in industrial action; in that case, Katzmann J was dealing with allegations of contravention of s 47 by engagement; her Honour imposed one penalty because the pleading alleged only a single unlawful picket (see [100]); similarly in the Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (The Yarra’s Edge Case) [2016] FCA 772, Jessup J imposed one penalty on the union where more than one official had, as pleaded, engaged “themselves and in combination” in industrial action in contravention of s 38 of the Act; the decision turned on the way in which the case was pleaded, conducted and the view of the facts taken by the judge; at [19], Jessup J took the view that on the facts it would have been artificial to have regarded the conduct of the union as engaging in separate industrial actions.
62 The Commissioner submits that the way in which s 94 attributes liability to a body corporate is agreed – it facilitates proof of the liability of bodies corporate by attributing the actions and states of mind of individuals to the union, not their contraventions or liability. The Commissioner submits that: the juridical consequence of the attribution of the conduct of individuals to the body corporate is that the body corporate also contravenes the relevant provision, as the appellants admitted in the SOAF, eg at [38]; this is what the primary judge was referring to when he said (at [45]) the union “ipso facto … will also contravene in the same way and by the same conduct”; the primary judge did not state that the liability of the Union was accessorial or vicarious; his Honour clearly distinguished the action of s 94 from s 92 of the Act at [43] of the First Reasons.
Consideration
63 In essence, the primary judge reasoned that, because each individual appellant engaged in separate conduct while participating in the picket and so contravened ss 47(1) and 52(a), the Union as a body corporate and building association (by reason of ss 94(1) and 95(1)) contravened ss 47(1) and 52(a) on as many occasions. In our view, that reasoning involves an incorrect construction and application of ss 94(1) and 95(1) for the following reasons.
64 First, it fails to appreciate the singular nature of the picket that was pleaded in the amended statement of claim and established by the agreed facts in the SOAF in relation to 25 January 2019. There was no allegation that there were multiple pickets, with a separate picket engaged in (or organised by, in the case of Michael Greenfield) by each official. To the contrary, the picket on 25 January 2019 was pleaded as a single picket. At [33] of the amended statement of claim it was alleged:
On 25 January 2019 at about 5:30 am a group of approximately 30 persons, including Kera, Mallia, M Greenfield, Hanlon, Byrnes, Russell-Anderson, Bulley, Astrup, Guarrera, Miller and McIvor, arrived at the Yard and positioned themselves across the driveway and entry gate to the Yard (the First Picket). …
The balance of this section of the pleading (from [33]-[46]) referred to the picket on that date as the “First Picket”, albeit comprising separate acts by different individuals, for which each of them was asserted to be individually responsible and for which the Union was asserted to be collectively responsible.
65 Similarly, the SOAF described a single picket on 25 January 2019. After setting out the facts relating to 25 January 2019 at [26]-[32], including separate acts by different people, the SOAF stated at [36]:
36. The actions of each of Kera, M Greenfield, Mallia and Byrnes in participating in the activities of the group set out in paragraphs 26 to 32 above constituted engaging in (and in the case of M Greenfield, organising) an unlawful picket within the meaning of section 47 of the BCIIP Act …
(Emphasis added.)
66 The subsequent paragraphs of the SOAF, in which the agreed contraventions of ss 47(1) and 52(a) relating to 25 January 2019 were set out, referred to a single picket. The relevant paragraphs were:
37. By reason of the matters in paragraphs 23 to 36 above, each of Kera, M Greenfield, Mallia and Byrnes contravened section 47 of the BCIIP Act by engaging in (and, in the case of M Greenfield, organising) an unlawful picket.
38. The conduct and actions of each of Kera, M Greenfield, Mallia and Byrnes on 25 January 2019 at Botany Cranes Yard, as set out at [paragraphs] 23 to 36 above, by reason of sections 94(1)(a) and 95(1)(b) of the BCIIP Act, was the conduct and actions of the CFMMEU, which thereby contravened section 47 on 25 January 2019.
39. The conduct of each of Kera, M Greenfield, Mallia and Byrnes on 25 January 2019 at the Botany Cranes Yard, referred to in paragraphs 23 to 36 above, constituted the taking of action against Botany Cranes with intent to coerce Botany Cranes to employ Byrnes as a building employee, that was unlawful, and contravened section 52 of the BCIIP Act.
40. For the purposes of “coercion” within the meaning of section 52, the conduct of Kera, M Greenfield, Mallia and Byrnes was unlawful in that it constituted an unlawful picket in contravention of section 47 of the BCIIP Act.
41. The conduct and actions of each of Kera, M Greenfield, Mallia and Byrnes on 25 January 2019 at Botany Cranes Yard, as set out in paragraphs 23 to 36 and 39 to 40, by reason of sections 94(1)(a) and 95(1)(b) of the BCIIP Act, were the conduct and actions of the CFMMEU, which thereby contravened section 52 on 25 January 2019.
(Emphasis added.)
67 It is important to note that, as is apparent from the above paragraphs of the SOAF, the contravention or contraventions of s 52(a) were based on the same facts as the contravention or contraventions of s 47(1), that is, the single picket.
68 Secondly, the primary judge’s approach pays insufficient regard to the nature of the proscription in s 47(1), and the need to characterise the conduct of the Union (that is, the conduct that the Union is taken to have engaged in by reason of ss 94(1) and 95(1)) to determine whether it constitutes a single contravention, or multiple contraventions, of s 47(1). A picket is an activity rather than a single act. Section 47(1) prohibits organising or engaging in an unlawful picket. The question here is: how many times did the Union organise or engage in an unlawful picket, in the context of the activity being a single continuous activity, as described in the agreed facts in the SOAF? In our view, on the proper characterisation of the agreed facts, the Union’s conduct by way of organising and engaging in an unlawful picket was singular, and should have been characterised as such by the primary judge. The Union’s singular act of organising and engaging in the picket was proved by the conduct of any one of the four officials, and was also pleaded by reference to the combined effect of that conduct.
69 Thirdly, notwithstanding certain statements by the primary judge to the contrary, his Honour in substance applied s 94 of the Act incorrectly as a vicarious liability provision, that is, a provision that renders the body corporate liable for a contravention of a provision of the Act because the official has contravened that provision. That the primary judge took this approach is most clearly seen from his statement in [45] that “where conduct of an individual, to which s 94 applies, constitutes a contravention of the Act, ipso facto, the body corporate will also contravene in the same way and by the same conduct as that individual” (emphasis in original). The primary judge cited Mallan v Lee at 215-216 and Hamilton v Whitehead at 126-127 in support of that proposition, but the provisions under consideration in those passages were differently expressed and structured, and we do not consider the passages to support the proposition that, where the conduct of an individual constitutes a contravention of the Act, and the requirements of s 94(1) are satisfied, the body corporate will necessarily contravene the Act. Further and in any event, the cases cited by the primary judge do not address the issue of the number of contraventions committed by the body corporate in circumstances where the conduct of more than one individual is attributed to a body corporate under ss 94(1) or 95(1), which is the issue of present relevance.
70 Section 94 attributes the conduct of an official to the body corporate; it does not necessarily follow that the body corporate contravenes the Act, or that it contravenes the Act on each occasion that an official contravenes the Act. In Robinson, Charlesworth J made the following observations about s 793 of the Fair Work Act 2009 (Cth), which was in substantially the same terms as s 94 of the present Act:
48 Section 793 does not, of itself, fix upon a body corporate liability for contraventions found to have been committed by its officers, employees or agents. Rather, it attributes to the body corporate the conduct and state of mind of its officers, employees and agents in prescribed circumstances. The question of whether the body corporate has contravened the FW Act (and, if so, on how many occasions) must be answered by assessing the facts, namely the conduct and state of mind attributed to the body corporate, against the elements of the contravention said to have been committed by it.
…
50 The second thing to be said about s 793 arises from my earlier observation that it does not directly operate to fix liability for a contravention on a body corporate; it is not to be regarded as a codification of the doctrine of vicarious liability: cf Trade Practices Commission v Tubemakers of Australia Ltd (No 2) (1983) 76 FLR 455 at 474-475; 47 ALR 719 at 739 (Toohey J). The mere fact that two employees of the CFMEU have each contravened the FW Act does not of itself, demand the conclusion that the CFMEU is liable for two contraventions.
71 These observations were applied by Jessup J in the Yarra’s Edge Case at [19]. Although expressed in relation to s 793 of the Fair Work Act, the observations of Charlesworth J in the above passage are equally applicable to s 94 of the present Act.
72 In our view, the correct analysis in the circumstances of this case (having regard to the way the case was pleaded and the facts agreed in the SOAF) is that the Union organised and engaged in only a single picket on 25 January 2019 and, in so doing, committed only one contravention of s 47(1). The Union’s organising of and engagement in the picket is to be regarded as the aggregate of its conduct, just as the engagement of any natural person is the aggregate of that person’s conduct. The primary judge wrongly treated the evidence of the engagement of each official as evidence of a separate and distinct engagement by the Union in the picket. That would have been appropriate treatment if the primary judge had been considering the Union’s vicarious liability for the engagement of each official. However, as discussed above, ss 94(1) and 95(1) do not operate in that way.
73 As for s 52(a), the analysis is largely the same because the question is the number of times the Union may be said to have taken “action” in circumstances where the action was the picket, and the picket was a single continuous activity.
74 We therefore uphold grounds 1 to 4.
75 It follows that the penalty imposed by the primary judge on the Union with respect to the events of 25 January 2019 (a global penalty of $500,000) needs to be set aside. That penalty was premised on the Union having committed four contraventions of s 47(1) and four contraventions of s 52(a). However, for the reasons set out above, the Union committed one contravention of s 47(1) and one contravention of s 52(a) on 25 January 2019. Therefore, paragraph 19(a) of the orders made by the primary judge on 19 May 2021 needs to be set aside. Paragraph 19(d) of those orders provided that, out of the penalty in paragraph 19(a), the Union was to pay $30,000 to Botany Cranes, $2,500 to Ms Hodges and $15,000 to the NSW Police Force. It follows from our decision that paragraph 19(a) needs to be set aside that paragraph 19(d) also needs to be set aside.
Grounds 6 to 13
76 Grounds 6 to 13 of the amended notice of appeal relate to the conclusion of the primary judge that, in respect of the events of 25 January 2019, each of the appellants was liable to more than one penalty – a penalty for contravention of s 47(1) and a penalty for contravention of s 52(a) – rather than being liable for only one penalty (as contended by the Union and the officials). By grounds 6 to 12, the appellants contend, in summary, that, by reason of s 83(2) of the Act, each of the appellants was liable to only one penalty as the contraventions related to the same conduct, and the primary judge erred in not so holding. The appellants also challenge aspects of his Honour’s construction of ss 83, 84 and 91. Ground 13 is an alternative ground, and need only be dealt with if grounds 6 to 12 are not successful.
77 It should be noted that, unlike grounds 1 to 4, grounds 6 to 13 are not concerned with the number of contraventions; they are concerned, rather, with whether each appellant was liable for more than one penalty in circumstances where (the appellants contend) the contraventions related to the same conduct. The individual appellants accept that, in relation to the events of 25 January 2019, they each committed one contravention of s 47(1) and one contravention of s 52(a). Likewise, as discussed above, the Union accepts that it committed one contravention of s 47(1) and one contravention of s 52(a) on 25 January 2019. The issue here is whether each appellant is liable for more than one penalty in respect of those contraventions.
78 Grounds 2 and 5 of the amended notice of contention are relevant here. In summary, the Commissioner contends that, in the event that the Full Court upholds ground 6 or 10 of the amended notice of appeal (which relate to the primary judge’s construction of ss 91 and 83(2) respectively), the imposition of separate penalties on the appellants for their contraventions of ss 47(1) and 52(a) should be affirmed on the basis that the contraventions involved different physical conduct (as to which the primary judge made findings as part of the findings he relied on).
79 Sections 81, 83, 84 and 91 of the Act are relevant for present purposes. Sections 81, 83 and 84, which were located in Div 1 (Obtaining an order for contravention of civil remedy provision) of Pt 2 (Orders for contravention of civil remedy provisions) of Ch 8, relevantly provided as follows:
81 Penalty etc. for contravention of civil remedy provision
(1) A relevant court, on application by an authorised applicant, may make one or more of the following orders relating to a person (the defendant) who has contravened a civil remedy provision:
(a) an order imposing a pecuniary penalty on the defendant;
…
Maximum penalty for civil remedy provisions
(2) The maximum pecuniary penalty is:
(a) for a Grade A civil remedy provision—1,000 penalty units if the defendant is a body corporate and otherwise 200 penalty units; and
(b) for a Grade B civil remedy provision—100 penalty units if the defendant is a body corporate and otherwise 20 penalty units.
…
Pecuniary penalties
(5) A pecuniary penalty under paragraph (1)(a) is payable to the Commonwealth, or to some other person if the court so directs. It may be recovered as a debt.
(6) In determining a pecuniary penalty under paragraph (1)(a), the court must take into account all relevant matters, including:
(a) the nature and extent of the contravention; and
(b) the nature and extent of any loss or damage suffered because of the contravention; and
(c) the circumstances in which the contravention took place; and
(d) whether the person has previously been found by a court (including a court in a foreign country) to have engaged in any similar conduct.
…
83 Conduct contravening more than one civil remedy provision
(1) If conduct constitutes a contravention of 2 or more civil remedy provisions, proceedings may be instituted under this Part against a person in relation to the contravention of any one or more of those provisions.
(2) However, the person is not liable to more than one pecuniary penalty under this Part in relation to the same conduct.
84 Multiple contraventions
(1) A relevant court may make a single civil penalty order against a person for multiple contraventions of a civil remedy provision if proceedings for the contraventions are founded on the same facts, or if the contraventions form, or are part of, a series of contraventions of the same or a similar character.
(2) However, any pecuniary penalty imposed must not exceed the sum of the maximum penalties that could be ordered if a separate pecuniary penalty were ordered for each of the contraventions.
80 Section 91, which was located in Div 2 (Civil proceedings and criminal proceedings) of Pt 2 of Ch 8, provided:
91 Civil double jeopardy
If a person is ordered to pay a pecuniary penalty under a civil remedy provision in relation to particular conduct, the person is not liable to be ordered to pay a pecuniary penalty under some other provision of a law of the Commonwealth in relation to that conduct.
Note: A court may make other orders, such as an order for compensation, in relation to particular conduct even if the court has made a civil penalty order in relation to that conduct.
81 The expression “civil remedy provision” is defined in s 5 of the Act as meaning a “Grade A civil remedy provision” or a “Grade B civil remedy provision”, each of which is a defined expression, referring to provisions of the Act that are identified as such in a Note. Sections 47(1) and 52(a) are both Grade A civil remedy provisions.
The primary judge’s reasons
82 The primary judge considered the construction of ss 83, 84 and 91 of the Act at [51]-[63]. His Honour referred, at [52], to Construction, Forestry, Maritime, Mining and Energy Union v Australian Building and Construction Commissioner [2019] FCAFC 201; 272 FCR 290 (the Hassett Appeal) (Bromberg, Wheelahan and Snaden JJ), which considered s 556 of the Fair Work Act, which was in the same terms as s 91 of the present Act. The primary judge noted that the Full Court held that the conduct, comprising contraventions of two provisions, overlapped and engaged the protection from double jeopardy in s 556 of the Fair Work Act. The primary judge stated that the decision in the Hassett Appeal was not binding, because it relates to the construction of a different Act (at [54]).
83 The primary judge also considered, at [55], Stuart v Construction, Forestry, Mining and Energy Union [2010] FCAFC 65; 185 FCR 308, noting that Besanko and Gordon JJ had held, on the facts, that a contravener could not be liable to two penalties for contravention of ss 38 and 44 of the Building and Construction Industry Improvement Act 2005 (Cth). The primary judge noted that, in that case, the contravention of s 38 was an integral element of the contravention of s 44, and that Besanko and Gordon JJ found that the unlawful conduct of the shop steward in organising the stop work meeting on the later day “was entirely subsumed in the conduct constituting” the broader contravention of s 44 (involving both days).
84 The primary judge stated at [59] that if the construction adopted in the Hassett Appeal in relation to s 556 of the Fair Work Act were applied to s 91 of the present Act, it would render s 83(2) of the Act otiose and s 84 of the Act meaningless (see also at [60]). His Honour then observed at [59]:
59 … Importantly, ss 83 and 84 refer to the consequences of there being more than one contravention of a “civil remedy provision”, being a term defined in s 5 of the Act. In contrast, s 91 is directed to what will occur if a person is ordered to pay a civil penalty “under a civil remedy provision”, by excluding the person from liability to pay a pecuniary penalty “under some other provision of a law of the Commonwealth in relation to that conduct”. The reference to “some other provision of a law of the Commonwealth” is to another Act of the Parliament or a regulation or other legislative instrument creating such a liability. That reference cannot be to another provision of the Act, because s 83(2) specifically deals with, and prevents, liability to the imposition of more than one pecuniary penalty under the Act “in relation to the same conduct” (emphasis added), and s 84(1) expressly allows the Court to impose multiple civil penalties for multiple contraventions of a civil remedy provision (under the Act) “founded on the same facts” (emphasis added).
(Underlined emphasis added.)
85 The primary judge expressed the following views at [60]-[61]:
60 In my opinion, ss 83, 84 and 91 of the Act operate, harmoniously (as, ordinarily, does the common law), to prevent a person being exposed to jeopardy twice for exactly the same conduct, being all of the physical and mental elements that go to making a person liable for a contravention of two laws at once: Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381–382 [69]–[71] per McHugh, Gummow, Kirby and Hayne JJ. However, once there is a substantive difference between one or both of the physical or mental elements, s 84(1) expressly provides, even though both contraventions “are founded on the same facts”, that each can be penalised separately, cumulatively or as having occurred as part of a course of conduct. …
61 In my opinion, the purpose of s 91 is to prevent a person being exposed to two penalties in relation to the same conduct (ie: the same physical and mental elements), one for contravening a civil remedy provision of the Act, such as s 52(a), and a second for contravening a provision of a different statute, such as s 355(a) of the Fair Work Act (which prohibits a person organising or taking, or threatening to organise or take, any action against another person with intent to coerce that other person or a third person to employ or not employ a particular person).
(Emphasis added.)
86 The primary judge therefore held, at [62], that the Full Court’s decision as to the construction of s 556 of the Fair Work Act in the Hassett Appeal could not be applied to the construction of s 91 of the Act. His Honour summarised his construction of ss 83, 84 and 91 in the following passages at [62]-[63]:
62 … I am of [the] opinion that the expressions “in relation to particular conduct” in s 91 and “in relation to the same conduct” in s 83(2) of the Act relate to two contraventions of the Act creating liability to a penalty that arise from the same legislatively proscribed conduct. But, as s 84(1) expressly provides, that Act allows “multiple contraventions… founded on the same facts” (emphasis added) to be penalised cumulatively, as occurred in Parker 270 FCR 39.
63 Importantly, the expression “a civil remedy provision” is defined in s 5 of the Act as meaning a provision that attracts a penalty for which the Act provides. Section 83 provides that a person is not liable to more than one penalty under the Act “in relation to the same conduct”. Thus, s 83 applies to multiple contraventions of a civil remedy provision proscribing the same conduct under the Act, but s 84(1) states that a person is liable to a civil remedy proceeding under the Act in respect of multiple contraventions “founded on the same facts” (emphasis added). In contrast, s 91 applies to a situation in which there is both a contravention of a civil remedy provision “in relation to particular conduct” under the Act and a contravention of other legislation “in relation to that conduct” (emphasis added) – namely, the same conduct that the legislation proscribes.
(Emphasis in original.)
87 The primary judge applied this construction of the provisions to the officials’ conduct on 25 January 2019 at [64]-[78] of the First Reasons. His Honour summarised the conduct of each individual (as set out in the SOAF) at [64]-[70] and then stated at [71]:
71 In my opinion, pars 37 and 41 of the agreed facts produce the result that on 25 January 2019 the officials contravened both ss 47(1) and 52(a) of the Act. The conduct that constituted the contravention of each section was different, although the contraventions were founded on the same facts. The conduct constituting each official’s contravention of s 52(a) was not “subsumed” in the conduct of that person in his, her or its contravention of s 47(1). That is because each contravention involved different elements and each contravener engaged in different conduct and acts in committing his or her contraventions even though there were some common facts. … I reject the contraveners’ argument that s 91 requires that only one penalty can be imposed in relation to that “particular conduct” based on the Hassett Appeal 272 FCR at 293–294 [14]–[19], 296 [26]. To the contrary, for the reasons I have given, I am of opinion that each of ss47(1) and 52(a) proscribe, and therefore involve, different conduct and create liability to two penalties, not one. A person may contravene both sections “founded on the same facts”, as s 84(1) contemplates, but the contraventions relate to different proscribed conduct and are distinct. The intention and conduct necessary to contravene s 52(a) are different to that for s 47(1).
88 In summary, the primary judge reasoned that the individual appellants were liable to more than one penalty for the contraventions of ss 47(1) and 52(a) because: (a) the intention and conduct elements of the two provisions are different; and (b) for each individual appellant, the conduct (including the mental state) that constituted the contravention of s 52(a) was different from the conduct (including the mental state) that constituted the contravention of s 47(1). It should be noted that, insofar as the primary judge stated in the first sentence of [71], that in his opinion the effect of the agreed facts was that the officials contravened both ss 47(1) and 52(a), there was (and is) no issue about this. The officials accepted that they had contravened both ss 47(1) and 52(a).
89 The primary judge applied essentially the same reasoning to the issue of whether the Union was liable for more than one penalty, holding that it was: see [86]-[93].
The parties’ submissions
90 It is common ground between the parties that the primary judge was correct to hold that s 91 of the Act is directed to contraventions of statutes other than the Act. An appeal ground – ground 5 – challenging that aspect of his Honour’s reasoning has been deleted in the amended notice of appeal.
91 The appellants submit that ss 83 and 84 deal with different subject matters: s 83 concerns proceedings where contraventions of more than one civil remedy provision of the Act are alleged to have been committed by the same conduct; s 84 deals with proceedings where multiple contraventions of the same civil remedy provision of the Act are alleged.
92 The appellants submit that the primary judge was in error in concluding at [60] of the First Reasons that s 84(1) permitted an aggregate penalty to be imposed for contraventions of different civil remedy provisions. The appellants submit that s 84(1) does not operate in relation to contraventions of different civil remedy provisions.
93 The appellants submit that the primary judge also erred at [60] of the First Reasons in determining that “conduct” for the purposes of ss 83(2) and 91 of the Act extended to a person’s “mental state” in relation to particular conduct.
94 The appellants submit that: s 83(2) operated to preclude the imposition of more than one penalty for the appellants’ conduct which contravened both ss 47(1) and 52(a) on 25 January 2019; and the primary judge’s imposition of penalties for both contraventions was beyond power.
95 The Commissioner agrees with the appellants that s 84 has no application to the problem of whether or not the individual appellants should have imposed on them more than one penalty for their contraventions of ss 47 and 52 of the Act, and submits that the primary judge did not treat s 84 as doing so.
96 The Commissioner submits that the debate turns, therefore, on the interpretation of s 83. The Commissioner submits that, as the primary judge indicated, s 83 seeks to do the work of s 91 where the contraventions are of two provisions under the Act, although s 83(2) prohibits more than one penalty “in relation to the same conduct” instead of “in relation to particular conduct”.
97 The Commissioner submits that: s 52 of the Act, like ss 348 and 355 of the Fair Work Act considered in Parker v Australian Building and Construction Commissioner [2019] FCAFC 56; 270 FCR 39, penalises “action” taken with a particular intent; a constituent and necessary part of what effects a contravention is the intention to negate choice; in Parker, the Full Court accepted that two coercion counts were not to be treated as the same conduct for the purposes of both ss 556 and 557, in part because of the different intentions required to be proved (but also because the conduct was “manifestly different”): at [278]-[280] and [312]-[313].
98 The Commissioner submits that, by contrast, in Australian Building and Construction Commissioner v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (The Australian Paper Case) (No 2) [2017] FCA 367, Jessup J’s dictum at [40], applied by the Full Court in the Hassett Appeal, was that while adjectival elements of a contravention were insufficient to differentiate them so as not to be the same “particular conduct”, nonetheless “particular conduct” includes “what the person actually did, with all of its attributes and in its whole context”. The Commissioner submits that: the intent component of a s 52 contravention is an attribute of what the appellants were found to have done; the primary judge therefore did not err in finding that, on the agreed facts and admissions, the contraventions of ss 47 and 52 were not “the same conduct” because they had different physical and mental elements.
99 The Commissioner submits that: there are differences between the language of s 556 of the Fair Work Act and s 83 of the present Act; s 83(1) commences with “If conduct constitutes a contravention of 2 or more civil remedy provisions…”; “conduct” used in this way indicates that it includes both the action and the intent, as both are required to constitute a contravention of s 52; s 556 uses a different linguistic approach – “If a person is ordered to pay a pecuniary penalty under a civil remedy provision in relation to particular conduct…”; the language of s 83 is distinguishable by structure and import, even if the decisions involving the Fair Work Act coercion provisions relied on by the appellants correctly applied s 556.
100 Further, in support of grounds 2 and 5 of the amended notice of contention, the Commissioner submits that: even if it was erroneous to treat “the same conduct” in s 83(2) as including both physical and mental elements of a contravention, the primary judge did not find that the physical conduct of the appellants in contravening ss 47 and 52 was the same; he found that it was different; at [86]-[93] of the First Reasons the primary judge carefully delineated the differences between ss 47 and 52, and the admission of different facts made in the SOAF as to how they were contravened; essentially, the primary judge located the different conduct supporting the coercion contravention in the inflammatory speeches made by the individual appellants by megaphone, their leading of hostile chanting directed towards Botany Cranes and their encouragement by their presence and leadership as senior Union officials of the coercive behaviour of the picket.
Consideration
101 It is important to note at the outset that care needs to be taken in applying the cases on s 556 of the Fair Work Act to the present context, as the Fair Work Act did not contain equivalent provisions to ss 83 and 84 of the present Act.
102 In our view, the appellants’ construction of ss 83, 84 and 91 of the Act is broadly correct.
103 Section 81(1)(a) of the Act allows a “relevant court” to make an order imposing a pecuniary penalty on a person who has contravened a “civil remedy provision”.
104 Section 83(1) deals with a circumstance where “conduct” constitutes a contravention of more than one civil remedy provision. The reference to “civil remedy provision” indicates a provision under the Act because of the definition in s 5. Section 83(1) permits proceedings to be instituted under s 81 against a person in relation to contraventions of one or more civil remedy provisions. However, s 83(2) prevents the person sued for contraventions of multiple civil remedy provisions under s 83(1), from being liable for more than one pecuniary penalty under Pt 2 of Ch 8 in relation to the same conduct. For example, and relevantly for present purposes, where contraventions of ss 47(1) and 52(a) based on the same conduct are alleged and established, the contravener will not be liable to be penalised for both contraventions and will, by s 83(2), be liable to be penalised for only one.
105 Section 84(1) has a different operation. It allows a court to make a single “civil penalty order” against a person for multiple contraventions of “a civil remedy provision” in stipulated circumstances. The phrase “a civil remedy provision” in s 84(1) refers to and means a single civil remedy provision; that is apparent from the use of “a”, the terms and purport of the section and the contrast with s 83(1) which refers to “2 or more civil remedy provisions”. Section 84(1), therefore, operates in relation to multiple contraventions of the same civil remedy provision if the proceeding is founded on the same facts or the contraventions form or are part of a series of contraventions of the same character. It does not operate where conduct constitutes a contravention of two or more civil remedy provisions.
106 Sections 83 and 84, therefore, deal with different subject matter. Section 83 concerns proceedings where contraventions of more than one civil remedy provision are alleged to have been committed by the same conduct. Section 84 deals with proceedings where multiple contraventions of the same civil remedy provision are alleged. If and to the extent that the primary judge concluded otherwise, we respectfully differ from his Honour, for the reasons already given.
107 Section 91 precludes a person who has been ordered to pay a pecuniary penalty under a civil remedy provision in relation to particular conduct being ordered to pay a pecuniary penalty in relation to that conduct under some other provision of a law of the Commonwealth. Like s 83(2), s 91 it is a double jeopardy provision. Unlike s 83(2), it is directed to “some other provision of a law of the Commonwealth”. Its sphere of operation is not limited to “civil remedy provisions” under the Act and extends to other Commonwealth statutes. The primary judge was correct to hold, at [59] of the First Reasons, that, in light of the terms and effect of s 83(2), s 91 is directed to contraventions of statutes other than the present Act. As noted above, this is common ground between the parties.
108 Sections 83, 84 and 91 can and should be construed in the above manner to produce a cohesive and harmonious operation: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [69]-[71] per McHugh, Gummow, Kirby and Hayne JJ. The provisions have different areas of operation and purposes. Having regard to these matters, they should be construed in the manner outlined above.
109 Turning to the meaning of the word “conduct” in ss 83(2) and 91, in our opinion, the primary judge erred in concluding (at [60]-[61]) that the references in these provisions to “the same conduct” or “particular conduct” mean all of the physical and mental elements that go to making a person liable for a contravention of two laws at once. The word “conduct”, in ordinary English, refers to what a person does or does not do. It does not encompass the mental element that accompanies a particular act or omission. That this is the sense that “conduct” is used in the Act is supported by the definition of “conduct” in s 5 of the Act. That section defines “conduct” as including an omission, which is inconsistent with the notion of a state of mind. It is further supported by the distinction drawn by ss 94 and 95 of the Act between conduct and states of mind. Parker, at the passages relied on by the Commissioner, does not stand for a contrary proposition.
110 Further, the words “the same conduct” and the “particular conduct” in ss 83(2) and 91 respectively refer to the actual conduct of the contravener rather than the elements of the statutory provisions that have been contravened. Otherwise, these provisions would be deprived of much of their operation and effect. While it is true that s 84 uses a different form of words (“founded on the same facts”) we nevertheless consider that ss 83(2) and 91 are concerned with actual conduct rather than elements of statutory provisions, for the reasons we have given.
111 It follows that we consider that the primary judge was in error in determining, in relation to each individual appellant, that the conduct comprising the contraventions of ss 47(1) and 52(a) was different because the contravention of s 52(a) was committed with an intention to coerce Botany Cranes. That intention pertained to the individual appellants’ states of mind in relation to their conduct. It did not form part of their “conduct” for the purposes of applying s 83(2).
112 Further, if and to the extent that the primary judge found, in relation to each individual appellant, that the physical conduct comprising the contraventions of ss 47(1) and 52(a) was different, we consider that his Honour erred in making such findings, having regard to the way the case was pleaded and to the facts agreed in the SOAF, which did not support the conduct being relevantly different.
113 The case was pleaded on the basis that the same conduct constituted the contraventions of s 47(1) and the contraventions of s 52(a) in relation to 25 January 2019. At paragraph 45 of the amended statement of claim, the Commissioner relied on “the matters referred to in paragraphs 33 to 42 above” as the basis for the allegation that the officials engaged in an unlawful picket in contravention of s 47 of the Act. The same group of paragraphs – 33 to 42 – also formed the basis of the alleged contraventions of s 52 by the officials: see, eg, paragraphs 50, 52, 54 and 58.
114 Further, the agreed facts in the SOAF rely on the same conduct as constituting the contraventions of ss 47(1) and 52(a). The key paragraphs of the SOAF are set out in [66] above. The same group of paragraphs (paragraphs 23 to 36) is relied on as the basis of the s 47(1) contraventions (see paragraph 37) and the s 52(a) contraventions (see paragraph 39).
115 In light of the way the case was pleaded and the facts agreed in the SOAF, it was not open to the primary judge to find (on the basis of the descriptions in the SOAF of the particular actions of each official) that the physical conduct constituting the contraventions of ss 47 and 52 was different.
116 Given the way the case was pleaded and the terms of the SOAF, the primary judge should have found, in respect of each appellant’s contraventions of ss 47(1) and 52(a), the contraventions were in relation to the same conduct for the purposes of s 83(2). Accordingly, each appellant was not liable for more than one penalty in relation to that conduct.
117 For these reasons, we uphold grounds 6 to 12 of the amended notice of appeal, and reject grounds 2 and 5 of the amended notice of contention. In light of our conclusion, it is unnecessary to deal with ground 13 of the amended notice of appeal.
118 It follows that the penalties imposed by the primary judge on the individual appellants with respect to the events of 25 January 2019 need to be set aside. (The penalty imposed on the Union has already been set aside as a result of upholding grounds 1 to 4.) Therefore, paragraphs 15, 16(a), 16(b), 17 and 18 of the orders made by the primary judge on19 May 2021 need to be set aside.
Grounds 14-16
119 The penalty imposed for the contraventions of s 54 on 31 January 2019 and 1 February 2019 is the subject of appeal grounds 14 to 16 and the notice of contention ground responding to grounds 14 and 15. The key issue concerns the Union’s assertion that the penalty was imposed by the primary judge upon the basis of a state of mind that was more serious than (or different from that) admitted to in the SOAF.
120 As summarised above, early on the mornings of 31 January 2019 and 1 February 2019, in the context of a meeting of employees outside the yard gate, Michael Greenfield had a conversation with the managing director of Botany Cranes, Mr Griffiths. The conversation was directed, on Michael Greenfield’s part, to getting Botany Cranes to accept the proposed Union EBA, stating what might happen if that did not happen on the first of those two consecutive days and promising an end to Union action if Mr Griffiths signed the proposed Union EBA on the second of those days.
121 It is convenient to reproduce s 54(1) of the Act again because the precise terms are important in the resolution of these appeal grounds(emphasis added):
A person must not:
(a) organise or take, or threaten to organise or take, any action; or
(b) refrain, or threaten to refrain, from taking any action;
with intent to coerce another person, or with intent to apply undue pressure to another person, to agree, or not to agree:
(c) to make, vary or terminate a building enterprise agreement; or
(d) to approve any of the things mentioned in paragraph (c).
122 The key issue raised by these grounds of appeal is whether there is, or at least may be, a distinction, in terms of seriousness, between intent to coerce and intent to apply undue pressure, for a contravention of s 54, having regard also to the characterisation of the corresponding conduct that was admitted to. Ground 14 directly raises this legal point, which is not a discretionary issue, while the related grounds 15 and 16 concern discretionary decision-making in penalty imposition, which are affected by the conclusion reached on ground 14.
123 In the amended statement of claim, alleged contraventions of s 54 by Michael Greenfield for each of 30 January, 31 January and 1 February 2019 were pleaded by the Commissioner in the alternative as to the two intentions, as threatening to organise or take action against Botany Cranes:
(a) with intent to apply undue pressure to Mr Griffiths and Botany Cranes to make a building enterprise agreement; or
(b) with intent to negate choice (being the essential element of coercion) of Botany Cranes as to whether or not to make a building enterprise agreement, or approve the proposed Union EBA, or make a building enterprise agreement in terms of the proposed Union EBA or on terms which Botany Cranes would not otherwise agree,
either way by engaging in conduct that was unlawful, illegitimate or unconscionable.
124 Michael Greenfield claimed penalty privilege in relation to those allegations in his defence, and no evidence was given by him as to his state of mind, so that the scope of what was admitted can only be determined by the content of the facts that were agreed upon.
125 By the SOAF, Michael Greenfield and the Union admitted to:
(a) a contravention of s 52 on 30 January 2019, in relation to the re-employment of Mr Byrnes, which was the prime focus of that day, because it was intimated by Michael Greenfield that reemploying Mr Byrnes would mean that bargaining on the enterprise agreement could resume, but did not admit to the alleged contravention of s 54 on that day directed to the enterprise agreement, being conduct that was admitted to be unlawful, illegitimate or unconscionable;
(b) contraventions of s 54 on 31 January 2019 and 1 February 2019 in relation to the enterprise agreement by organising or taking action (not threatening to do so), with an intention to apply undue pressure to another person to make or approve a building enterprise agreement (also admitted to be unlawful, illegitimate or unconscionable), but not with the alternative pleaded intention to coerce another person to make or approve a building enterprise agreement.
126 There was no agreement that the words uttered by Michael Greenfield on either 31 January 2019 or 1 February 2019 amounted to threats as had been alleged in the amended statement of claim, nor any agreed fact, admission or evidence that Mr Griffiths, to whom the words were uttered, felt overborne. The relevant agreed fact (at SOAF [57]) was that the conduct of Michael Greenfield constituted the organising or taking of action against Botany Cranes with intent to apply undue pressure to agree to make or approve a building enterprise agreement, contrary to s 54. By contrast, there was an overt admission (at SOAF [50]) that on 30 January 2019 Michael Greenfield threatened to organise or take action against Botany Cranes with intent to coerce, contrary to s 52. Thus, there was an obvious and deliberate agreement that the conduct on 30 January 2019 was conduct involving threats and coercive intent, and that the conduct on 31 January 2019 and 1 February 2019 did not include conduct that involved threats. It was agreed that it did involve intent to apply undue pressure, but no more.
127 The pleaded contraventions of s 54 on 30 January 2019 that were not admitted to or otherwise proceeded with thus provide important context to understand what Michael Greenfield and the Union were, and were not, admitting to as constituting contraventions of s 54. If a particular state of mind going beyond what was admitted to was relied upon by the Commissioner, it was incumbent on him to prove it: see Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd [2016] FCAFC 181; 340 ALR 25 at [131].
128 As can be seen from the passages of the primary judge’s reasons set out below, despite an apparently deliberate decision and agreement made by the parties to characterise the conduct and intention on 31 January 2019 and 1 February 2019 in a materially different way, his Honour described Michael Greenfield’s conduct and his corresponding intention on both occasions as threatening and intimidating, treating the conduct at both periods of time as being much the same, by equating the later conduct and intention involving threats to the earlier conduct and intention which was admitted to have that content and character. This approach indicates that the parties treated the impugned conduct in this case, accompanied by an intention to apply undue pressure, as being less serious than the same conduct accompanied by an intention to coerce.
129 At the appeal hearing, counsel for the appellants emphasised that the complaint was that the primary judge appeared to have gone beyond the agreed lesser conduct as to state of mind in the SOAF that was the basis of the resolution of the proceeding and appeared to have analysed Michael Greenfield’s conduct as if it carried the heightened state of mind of coercion. This gives rise to the question, raised at the appeal hearing, of whether his Honour had failed to give due recognition to the limit on what had been agreed to in relation to the conduct on 31 January and 1 February 2019.
130 As a matter of principle, a civil penalty case should not be decided upon a basis that is materially different from that which has been pleaded unless that departure is in some way agreed to: Australian Building and Construction Commissioner v Hall (2018) FCAFC 83; 216 FCR 347 at [49]-[50]. The same principle applies when, as in this case, agreed facts have taken the place of a defence in defining what has been agreed to as constituting the contraventions for which a penalty may be imposed. There is no suggestion that Michael Greenfield or the Union agreed to any disposition upon a basis that departed from the SOAF.
131 Further and in any event, departing from agreed facts expressly made under s 191 of the Evidence Act 1995 (Cth), as was done by [2] of the SOAF, ordinarily requires the leave of the Court under s 191(2)(b). There is no suggestion that such leave was sought or granted.
132 The primary judge addressed the contraventions on 31 January 2019 and 1 February 2019 in his Honour’s first reasons as follows, with express reference to the words deployed by Michael Greenfield on those days admitted by him to constitute those contraventions of s 54(1) (emphasis added):
130 In the two day period between 31 January and 1 February 2019, Michael Greenfield and the Union contravened s 54(1) of the Act by taking action with intent to apply undue pressure to Botany Cranes to agree to make or approve the CFMMEU proposed EBA (agreed facts pars 53–55).
131 On 31 January 2019, Michael Greenfield repudiated what he had told Mr Griffiths the previous day and brazenly threatened Botany Cranes if it were not willing to capitulate to the Union’s terms. Michael Greenfield returned the next day, making plain the Union’s modus operandi when he said “If you sign the [CFMMEU proposed] EBA we will leave your sites alone”. Eventually, Mr Griffiths signed that document on 12 February 2019.
132 The Union argued that “undue pressure” was a lesser form of proscribed behaviour in s 54(1) than coercion. I reject that argument. The Act does not create such a gradation. Nor does common experience: Barton [1976] AC at 120D–F; Esso 263 CLR at 585 [61]: see [84]–[88] above.
133 Fear, however created, is a powerful motivator. The maximum penalty for a contravention of s 54(1) is the same for conduct amounting to coercion as for conduct amounting to undue pressure. Each is an alternate form of unlawful behaviour. Michael Greenfield’s statement on 31 January 2019 to Mr Griffiths “If I were you, I’d fuckin’ sign it”, his threat “… what do you think will happen to you?”, followed up the next day by “If you sign the EBA we will leave your sites alone” were not idle chit chat. They were overbearing threats, intended to be so, and they worked. There is no mitigating that illegitimate intimidation by the making of fine distinctions between the two forms of unlawful behaviour that s 54(1) proscribed.
134 Michael Greenfield admitted that, in contravention of s 54(1), he had organised or taken action against Botany Cranes on 31 January and 1 February 2019 with intent to apply undue pressure on it to agree to make or approve a building enterprise agreement. The pressure was unlawful, illegitimate and unconscionable. Once again, his conduct and intention were also those of the Union by force of s 94(1). The behaviour exhibited the same lamentable factors that I described in [127] above in respect of the conduct on 30 January 2019. Likewise, these contraventions of s 54(1) call for a severe penalty in order to achieve specific and general deterrence.
133 The conclusion reached by the primary judge at [132], reproduced above, that he rejected the Union’s argument that “undue pressure” was a lesser form of proscribed behaviour, at least in this particular case, is a legal conclusion particularly amenable to appellate review: see Aldi Foods Pty Ltd v Moroccanoil Israel Ltd [2018] FCAFC 93; 261 FCR 301 per Perram J at [45], especially the last sentence. As the grounds of appeal reproduced below make clear, it is that conclusion that is sought to be impugned by the Union and Michael Greenfield, and said to infect the penalty imposition process and result because, it is alleged, his Honour applied a more serious state of mind than had been admitted to.
134 The reference by the primary judge at [132] to the earlier passages at [84] to [88], which contain consideration of what may constitute coercion, reveal his Honour’s thought processes on this topic, informing the conclusions that were reached and enabling them to be better understood (emphasis added):
84 There may be a gradation of seriousness, in the ordinary course, between a person who engages in an unlawful picket or takes action to coerce another, in contravention of ss 47(1) or 52, in comparison to a person who organises either activity, though this need not always be so. Each case necessarily must be decided in its factual context. At the more extreme end, a threat to kill conveyed by one or more persons unless the person threatened signed a contract is a form of undue pressure or coercion, as graphically illustrated by the facts in Barton v Armstrong [1976] AC 104 at 120D. However, many other human behaviours are capable of creating a coercive impact of varying degrees of seriousness. We have all experienced ourselves, or as observers, or through the shared experiences of persons we know, bullying and harassing conduct. As in this proceeding, a large group of about 50 individuals, mostly comprising apparently strong, physically well-built males blocking or controlling what would otherwise be free entry to and egress from premises while aggressively chanting self-promoting slogans and pumping fists in the air, is calculated to instil fear into persons who are within or wish to enter those premises.
85 The Parliament enacted provisions such as ss 47, 52 and 54 of the Act to address the illegitimate use of coercion and undue pressure in the building and construction industry by employers, employees and both interests’ representative bodies, such as trade associations and trade unions. The Parliament acted in the context that it had already established, through the Fair Work Act and the Fair Work Commission, some similar prohibitions in that enactment as in the Act (like s 355 of the Fair Work Act and s 52 of the Act) and an independent mechanism for the formulation and enforcement of fair and transparent workplace standards, including terms and conditions of employment and the ability of that Commission to settle disputes impartially.
86 There is a substantive difference in the elements of conduct constituting a contravention of s 47(1) of the Act, on the one hand, and ss 52(a) and 54(1), on the other. Indeed, the Parliament placed these sections in different parts of the Act; s 47 is in Ch 5 that is headed “Unlawful action” and ss 52 and 54 are in Ch 6 that is headed “Coercion, discrimination and unenforceable agreements”. Coercion is a behaviour that involves the exertion of illegitimate, unlawful or improper force or compulsion on a person with the intention of causing its subject to act as the person exerting the force or compulsion desires. Coercion, like undue pressure, is a behaviour that goes beyond what is legitimate or proper in interactions between people, as the authorities dealing with unlawful duress recognise.
87 Lawful, hard negotiating, or the exploitation of another’s weak negotiation positon (for example, because they are in breach of a contract or without sufficient resources), is not the same as the over-reach by a party with a stronger position to negate the subject’s choice that crosses the boundary between lawful and unlawful or unconscientious conduct. The identification of that boundary will sometimes require a value judgment by a court, such as that in the divergent judicial appraisals of the facts in Barton [1976] AC 104.
88 In Esso Australia Pty Ltd v Australian Workers’ Union (2017) 263 CLR 551 at 585 [61], Kiefel CJ, Keane, Nettle and Edelman JJ, with whom Gageler J agreed (at 587–588 [65]) noted that, as the law presently is, coercion within the meaning of s 343 of the Fair Work Act is action that, first, is unlawful, illegitimate or unconscionable, secondly, the person organising, taking or threatening the action intended, by doing so, to negate the other person’s choice, and, thirdly, the alleged contravener has actual knowledge of circumstances that makes his or her conduct unlawful. They held that it was unnecessary that the alleged contravener correctly appreciates the legal nature of the action he or she organised, threatened or took. The expression “undue pressure” is descriptive of conduct of a similar nature that, like coercion, goes beyond legitimate pressure of a lawful industrial or workplace interaction, negotiation or dealing: Esso 263 CLR at 585 [61]. The statutory expression “undue pressure” is apt to proscribe pressure that is illegitimate, such as would amount to economic duress, excessive, unjustifiable, improper or unreasonable, given the industrial context.
135 The passage in Esso Australia Pty Ltd v Australian Workers’ Union [2017] HCA 54; 263 CLR 551 at [61] cited by the primary judge above, does not support equating coercion with undue pressure. While the latter may involve conduct that is objectively unlawful, illegitimate or unconscionable, unlike coercion that is not required to be established, even if it may be present, and even if, as in this case, it is admitted to as a feature of the undue pressure that was applied by Michael Greenfield and thus the Union.
136 The cross-reference by the primary judge at [132] to [84] to [88], and the focus on the content of coercion in the latter, followed by a measure of equivalence being drawn between that and undue pressure, tends to suggest that the primary judge treated the two states of mind as comparable when arriving at the penalty to be imposed for the contraventions of s 54 of the Act on 31 January and 1 February 2019.
137 The grounds of appeal and of contention are better reproduced than summarised. The relevant grounds of the amended notice of appeal are:
14. The primary judge erred in imposing penalties on the [Union] and [Michael Greenfield] in relation to their contraventions of s 54(1) of the BCIIP Act on 31 January and 1 February 2019 by holding that a contravention of s 54(1) of the BCIIP Act based on conduct engaged in with an intention to apply undue pressure was of equivalent seriousness to a contravention based on conduct engaged in with an intention to coerce and that s 54(1) of the BCIIP Act did not create a gradation of seriousness as between conduct engaged in with an intent to apply undue pressure as compared to conduct engaged in with an intention to coerce.
15. The primary judge erred in concluding that [Michael Greenfield’s statements on 31 January 2019 were ‘overbearing threats’ in circumstances where the contravention of s 54(1) of the BCIIP Act on 31 January 2019 was based on [Michael Greenfield] engaging in conduct with intent to apply undue pressure rather than conduct with intent to coerce.
16. The primary judge erred in imposing penalties on the [Union] and [Michael Greenfield] in relation to their contraventions of s 54(1) of the BCIIP Act by holding in the absence of evidence that the [Michael Greenfield]’s statements on 31 January 2019 were ‘overbearing threats’.
138 The ground of the amended notice of contention directed to appeal grounds 14 and 15 is:
In the event that the Court upholds these grounds, and it is found that the primary judge imposed penalties on the basis that undue pressure was impermissibly equated with an intention to coerce for the purposes of applying section 54(1), the imposition of penalties on the first and third appellants for contraventions of section 54(1) of the BCIIP Act should be affirmed on the basis that it was open to the primary judge to impose those penalties in the exercise of the penalty discretion given the primary judge’s factual findings as to the serious nature of the conduct involved.
139 Of course, an appeal must be from orders, not reasons, albeit that an error found in reasoning may mean that the orders made upon such a basis can be shown to be infected with that error: Ah Toy v Registrar of Companies for the Northern Territory (1985) 10 FCR 280 at 285-286 per Toohey, Morling and Wilcox JJ; see also Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Registered Organisations Commissioner (No 2) [2021] FCAFC 56 at [12] and the cases there cited. Both the grounds of appeal and the ground of contention above therefore are to be read as requiring a determination as to whether such an infection has been established as to the process and final result.
140 It may be seen that the above grounds of appeal and contention give rise to the following issues for determination:
(a) whether there is any distinction in terms of seriousness (or otherwise) in s 54 of the Act as to an intention to coerce as against an intention to apply undue pressure;
(b) if so, whether his Honour proceeding on the basis that the state of mind here was tantamount to an intent to coerce by referring to “brazenly threatened”, “overbearing threats”; “intimidation” and the conduct on those two days as exhibiting “the same lamentable factors … in respect of the conduct on 30 January 2019”;
(c) if so, whether the penalty imposed was excessive to the extent of constituting an error in the exercise of the penalty imposition discretion.
The distinction between intention to coerce and intention to apply undue pressure
141 Because the dual intentions of coercion and undue pressure were both pleaded, and because Michael Greenfield expressly admitted to the latter and therefore not to the former for the conduct on 31 January and 1 February 2019, if there is a distinction to be drawn between the two, the admission he made can be understood as being that of having an intention to apply undue pressure falling short of coercion. If the two states of mind are conceptualised as a Venn diagram with two overlapping circles, the admission is confined to that part of undue pressure that does not overlap with coercion.
142 That is, both Michael Greenfield and the Commissioner have proceeded upon a particular basis, and it is incumbent upon the Court to proceed on the basis of the admissions made, not least because the focus of deterrence, both general and specific, needs to be on the conduct proven or agreed to have been engaged in, including the state of mind, and therefore sought to be deterred. To do otherwise may be seen to breach the proscription on oppression articulated by the High Court in Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; 399 ALR 599 at [46] that the penalty imposed “strikes a reasonable balance between oppressive severity and the need for deterrence in respect of the particular case”.
143 The Union and Michael Greenfield submit that coercion in requiring the negation of choice is a higher threshold than undue pressure. In context, that is best understood as saying that negation of choice may be a higher threshold than undue pressure, not that it necessarily does so in all cases, and was so in this case because of the admissions that were, and were not made. They rely upon the observation made by Wigney J in Construction, Forestry, Mining and Energy Union v De Martin & Gasparini (No 2) [2017] FCA 1046 at [14] that there was considerable authority in relation to the element of intention to coerce in s 54, and that the little authority in relation to the element of intention to apply undue pressure tended to suggest that it may have a different operation, or impose a lower threshold, citing John Holland Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2009] FCA 235; 174 FCR 526 per Jessup J at [56] to [61]; Australian Federation of Air Pilots v Jetstar Airways Pty Ltd [2014] FCA 15 per Pagone J at [13]. In John Holland, Jessup J observed:
56 I turn next to the notion of “undue pressure” employed in s 44 of the BCII Act. These words did not appear in s 170NC of the WR Act, which was the corresponding provision, applicable to industry generally, at the time when the BCII Act was enacted in 2005 (see now s 400 of the WR Act). Counsel were unable to assist me as to why these words were introduced. The Explanatory Memorandum to the BCII Act makes it clear that many of its provisions were introduced in consequence of the Report of the Royal Commission into the Building and Construction Industry, but that document appears to contain no recommendation which would have involved an extension of the concept of coercion as used in what was then s 170NC of the WR Act. The Explanatory Memorandum does not deal with “undue pressure” at all (other than, as frequently occurs, to explain the new provision in a grammatical paraphrase of the words of the section). The words have not, it seems, been the subject of judicial exposition. In these circumstances, it appears that the court is thrown back on first principles in its task of giving a connotation to these words.
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59 What is clear, as a matter of construction, is that the application of undue pressure was regarded by the legislature as something different from coercion. Assuming, as I do, that the legislature intended the reach of s 44 to travel beyond the reach of the then existing s 170NC of the WR Act, it is at least respectably arguable that the legislature intended the expression to connote forms of pressure that were reprehensible, blameworthy or inappropriate in ways that could not be described as unlawful, illegitimate or unconscionable. In this respect, I do, of course, assume that, in 2005 when the BCII Act was enacted, the legislature was aware of the connotation which had been given to the word “coerce” in s 170NC in Seven Network (decided in 2001) and the earlier authorities referred to therein.
144 The Commissioner defends the primary judge’s reasoning as being correct on its face, rather than relying upon any specific authority to support it beyond a reference to Esso Australia. The Commissioner submits that treating both forms of conduct in terms of intention as being subject to the same consequences allows s 54 to fulfil its legislative intent of making available in the sphere of regulation in the building industry a broader civil penalty provision to deter unlawful conduct in pursuit of securing enterprise agreements. The Commissioner contends that if the legislature had intended some differentiation or restriction in the capacity of the court to impose orders under s 81 for contraventions of s 54 according to the type of behaviour admitted, it would have said so. The Commissioner further contends that the finding of conduct and the characterisation of its objective seriousness for the purpose of penalty by the primary judge should not be restricted by s 54 or the pleading, and that the assessment of seriousness was a separate matter for penalty.
145 The Commissioner’s submissions cannot be accepted. It cannot be accepted that the legislature has not provided for a differentiation of intention attaching to conduct that is proscribed by s 54, especially for legislation enacted in the context of long-standing authority identifying a material distinction. Two quite different intentions are expressly proscribed. That distinction was maintained by the Commissioner pleading both states of mind in the alternative, and Michael Greenfield and the Union admitting to one and not the other. The notion that there would be the same consequence for the conduct irrespective of the basis for a contravention existing overlooks the fact that differential proscriptions, both as to conduct and as to state of mind, can be readily explained as broadening the scope of the proscription and therefore widening the range of conduct that is covered, and in the course of doing so providing scope for a wider range of differentiation and seriousness, and thereby need for deterrence.
146 It is common in statutes to provide a series of alternative phrases to describe conduct that is proscribed, often by overlapping terms and concepts, to ensure that the breadth of behaviour sought to be regulated is covered. For example, the permit holder provision in s 500 of the Fair Work Act 2009 (Cth) proscribes a holder exercising rights in a way that intentionally hinders or obstructs or acts in an improper manner, which can be seen to present a range of conduct of potential differential seriousness, even though the maximum penalty is the same for each. Coercion, with the imbedded concept of negating choice, generally involves more serious conduct than undue pressure, which does not have that element required to be proved. In any event, they are different states of mind. It follows that an intention to apply undue pressure may not amount to an intention to coerce, and this necessarily creates scope for a degree of gradation, subject to the facts in a given case. That gradation or difference was reflected in the Commissioner’s pleading, and in the SOAF admitting to one state of mind and not the other.
147 Had the proscription in s 54 been confined to a state of mind of coercion and had not included as well undue pressure, at least some of the time that would not be able to be proven or admitted to because of conduct that met the description of undue pressure while falling short of amounting to coercion, because, for example, in this case there was ultimately no suggestion of negating choice on 31 January and 1 February 2019, while that aspect was accepted to be present on 30 January 2019. That is, there will be circumstances in which there is coercion going beyond undue pressure, and circumstances in which there is undue pressure that falls short of coercion, and even some greater degree of gradation. The admission made in relation to 31 January and 1 February 2019 was to undue pressure and not to coercion in the sense of negation of choice that had also been alleged.
148 It follows that to the extent that the primary judge treated the state of mind as being tantamount to an intent to coerce, the primary judge erred because the appellants had not admitted to this state of mind.
Whether the primary judge applied a different state of mind to that admitted by referring to “brazenly threatened”, “overbearing threats”, “intimidation” and the conduct on those two days as exhibiting “the same lamentable factors … in respect of the conduct on 30 January 2019”
149 Section 54 may be seen to amount to a legislative choice being given to the regulator whether to allege that the intention standing behind the conduct was that of coercion or undue pressure (or both), rather than two ways of saying the same thing. All other things being equal, the more serious conduct is, the greater the need for deterrence, both general and specific. Coercion, which requires an intention to negate choice, is ordinarily more serious than undue pressure, even if it is conceptually possible to envisage in a given case an example of higher level undue pressure that is more serious than lower level coercion.
150 The Commissioner submits orally that what the primary judge was required to do, and did, once his Honour understood what was admitted, was to look at the circumstances of the contraventions in order to determine the penalty necessary to effect the necessary deterrence, placing reliance also upon a video recording and associated sound track of what took place on the first of the two days, 31 January 2019. In a perhaps Freudian slip of the tongue, senior counsel for the Commissioner referred to Michael Greenfield re-adopting the “coercive” approach toward the enterprise agreement, being the very thing the Union and Michael Greenfield complain about, because that state of mind was only admitted in relation to the reinstatement of Mr Byrnes.
151 Characterising the words uttered by Michael Greenfield on 31 January and 1 February 2019 as “brazenly threatened” and “overbearing threats” and so on could have amounted to no more than taking issue with the primary judge’s turn of phrase or mode of expression. However, in the context of his Honour referring at [133] to “fear, however created, is a powerful motivator”, and then to “overbearing threats” being “illegitimate intimidation”, and dismissing the distinction between intent to coerce and intent to apply undue pressure as making “fine distinctions”, it can readily be seen that the primary judge has treated the state of mind here as tantamount to an intent to coerce, going beyond what was agreed to. The conduct has been effectively characterised as being carried out with a state of mind that was indistinguishable from an intention to coerce. In doing so, his Honour erred.
Whether the penalty imposed was excessive to the extent of constituting an error in the exercise of the penalty imposition discretion
152 The primary judge at [151], in determining the penalty to be imposed upon Michael Greenfield, said (emphasis added):
His contravention of s 54(1) on 31 January and 1 February 2019 involved a further increase in the intensity of his and the Union’s bullying tactics. The conduct extended over two days and again involved the calculated menace reflected in his speech on 25 January 2019, namely: “the f…king law is stacked against us, but we continue to do it the way we do it”. It is essential that the Union stop doing “it”, namely using coercion and undue, unlawful, illegitimate and unconscionable pressure to impose its will. Here, the Full Bench of the Fair Work Commission, on 24 January 2019, had reserved its decision in the Union’s appeal about whether Botany Cranes had agreed to the CFMMEU proposed EBA so that it should be approved. The Union did not want to run the risk of losing that appeal, so it resorted to applying undue pressure to compel Botany Carnes to bend to its will and avoid a lawful and fair resolution of the dispute. This conduct cannot be tolerated in our society. It strikes at the heart of the rule of law. I will impose a penalty of $35,000 on Michael Greenfield for that conduct. The total of penalties against him amounts to $100,000.
153 It is important that an appeal court does not fasten upon infelicities of expression and mere turns of phrase. However, in the context of the repeated references to threats, and the reference in the above passage to “coercion”, which were not what was agreed had taken place on 31 January to 1 February 2019, it is difficult to avoid the conclusion that the primary judge has proceeded on the basis that the state of mind was tantamount to an intent to coerce, despite the admission being limited to an intent to apply undue pressure.
154 The penalty imposed upon Michael Greenfield for the contraventions on 31 January and 1 February 2019 of $35,000 out of a maximum of $42,000, contrasts with the penalty of $30,000 for the s 52 contravention upon the admitted basis of an intention to coerce (and therefore to negate choice). We consider that the penalties were imposed upon a basis infected with error, which flowed through to the penalty of $175,000 imposed upon the Union. That conclusion also means that the ground in the amended notice of contention specifically addressing appeal grounds 14 and 15 cannot succeed.
155 It follows that grounds 14, 15 and 16 have been made out and the penalties imposed upon Michael Greenfield and the Union for the contraventions of s 54 on 31 January 2019 and 1 February 2019, being paragraphs 16(d) and 19(c) of the orders made by the primary judge on 19 May 2021, need to be set aside.
Ground 21 – the penalty imposed on Ms Mallia
156 This ground of appeal is that the primary judge erred in imposing penalties upon the fourth appellant, Ms Mallia, in holding that she had succumbed to the embedded culture of the Union. This ground largely turns on the following two paragraphs of his Honour’s reasons:
139 In my opinion, Ms Mallia’s conduct on 25 January 2019 has to be viewed having regard to her position of leadership and authority in the branch and the Union. She lent her status to the unlawful picket and coercion that occurred on 25 January 2019. I have taken into account that, in committing those two contraventions, Ms Mallia has no prior contravening history.
140 But, she succumbed to what is obviously the embedded culture in the Union. That culture treats the laws enacted by the Parliament as irrelevant to what the Union and its officials feel free to do in breach of them. The Union regards any penalty as a mere price of its doing business. It is essential that persons in the senior leadership of the Union, such as Ms Mallia, and its members generally, be deterred from engaging in such behaviour. The price of contravention must be set so high that persons who might feel emboldened by the toxic culture, revealed in the Union’s history of defiance of the law, know that the Court will exercise its powers to deter them and any others who might contemplate doing so in the future.
157 The agreed facts stated that Ms Mallia was at all material times the President of the NSW Divisional Branch of the Union and a member of its Committee of Management, an official of the Union within the meaning of ss 94 and 95 of the Act, an employee and member of the Union, a building industry participant within the meaning of s 5 of the Act and, with regard to the actions taken by her set out in the agreed facts, was an official of the Union acting in that capacity and within the scope of her actual or apparent authority. There is a factual dispute as to the significance of the positions that Ms Mallia held, but nothing much turns on this and it does not require resolution. What mattered was that on any view, Ms Mallia was a reasonably senior official of the Union.
158 The agreed facts, the key passages of which were reproduced by the primary judge in his reasons, disclosed that Ms Mallia took an active role in the picket at Botany Cranes’s yard on 25 January 2019. This included being one of the attendees wearing Union branded clothing, being present while others such as Mr Kera and Michael Greenfield addressed the meeting, addressing the meeting herself to thank the members who had turned up, and being one of those chanting aggressively “Union, Power!” and “Who are we – CFMEU!”, “One day longer, one day stronger” and “The workers united will never be defeated”. Ms Mallia’s conduct in engaging in the picket on that day was admitted both to being unlawful in taking place at all contrary to s 47 of the Act, but also involving the taking of action against Botany Cranes with intent to coerce them to employ Mr Byrnes as a building employee contrary to s 52 of the Act.
159 The primary judge had earlier described what the video recording for 25 January 2019 disclosed as follows:
69 Ms Mallia spoke briefly, and some content of what she said did not come over clearly in the police video because of her quieter voice and the police discussions, including organising to escort Ms Hodges into the yard, which occurred at the end of Ms Mallia’s speech and the beginning of Mr Byrnes’. Ms Mallia spoke as, and with the authority of, the branch president. She thanked and gave encouragement to the group to pursue the unlawful picket and to seek to coerce Botany Cranes to reinstate Mr Byrnes. Her involvement was, in one sense, of a lesser degree than that of Mr Kera and Michael Greenfield. But, her participation, as president, in the conduct was a powerful indication that the Union as a whole was there to demonstrate its commitment to achieving Mr Byrnes’ reinstatement by the coercive means that the two preceding speeches had stated with unmistakable directness.
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74 I reject the submission of Ms Mallia and the Union that her degree of engagement in both the picket and coercion ought be characterised at the lower end of the scale of seriousness. Such a characterisation would overlook the significance of both her presence at the scene that represented the authority of her office, as president of the state branch, and her lending, as president, support to (because she did not seek to qualify or repudiate) what Mr Kera or Michael Greenfield had said immediately before she addressed the group. After all, as president, she could be presumed to be the leader and have the capacity to direct or control, or at least to have a real input into, what the Union wished to occur and how the group should behave. The fact that the president was in attendance, and spoke after Mr Kera’s and Michael Greenfield’s threatening speeches, without her offering any qualification to what each preceding speaker had identified as the Union’s, and the group’s, aims and means to achieve them, was a symbolic and powerful indicator to the group and listeners, including Botany Cranes’ personnel, that the whole Union (or, at least, the state branch) was present to enforce its will, regardless of the law, over Botany Cranes until it capitulated. For the reasons above, Ms Mallia, like Mr Kera and Michael Greenfield, contravened both ss 47(1) and 52(a) of the Act.
160 Ms Mallia submits that there was no evidence or pleaded allegation that she held the views of the Union or that she had capitulated or yielded to its culture, such that those conclusions about her attitude and state of mind were conjectural and without any evidentiary foundation. Accordingly, she argues that the determination of the penalty to be imposed upon her miscarried and should be set aside.
161 The Commissioner characterises the conclusions reached by the primary judge as being, if anything, lenient, having regard to the nature and content of the speeches made in her presence, especially by Michael Greenfield and Mr Kera, the agreed facts and the video recording taken by a police body camera as summarised by his Honour, and her admitted role in the Union. Noting that there is no complaint made about the findings of his Honour as to the culture of the Union, the Commissioner submits that it was an inference available to his Honour that Ms Mallia was at least a participant in and supporter of that culture, especially given the position that she occupied.
162 The Commissioner’s submission should be accepted. The conclusions reached by the primary judge were obvious and reasonably available inferences to draw in determining the appropriate penalty and the need for deterrence. This ground of appeal must therefore fail. However, the penalties imposed upon Ms Mallia by paragraph 17 of the orders made by the primary judge on 19 May 2021 will be set aside upon a different basis, consequent upon the success on grounds 6 to 12.
Ground 22 – Michael Greenfield’s motivation in contravening s 54 on 31 January 2019 and 1 February 2019
163 This ground of appeal alleges that the primary judge erred in imposing penalties upon Michael Greenfield and the Union in the absence of evidence that the contravening conduct on 31 January 2019 and 1 February 2019 was motivated by a desire by the Union not to run the risk of losing the appeal to the Full Bench of the Fair Work Commission concerning approval of the Union’s proposed EBA.
164 The relevant passages of the primary judge’s reasons are as follows:
6 From 2012, an enterprise agreement with a nominal expiry date of 31 May 2015 had covered Botany Cranes, its employees and the Union. In about February 2018, the Union, on behalf of its members who were employees of Botany Cranes, began negotiating with the company with a view to arriving at terms for a replacement enterprise agreement. This process included the Union providing Botany Cranes with its terms for a proposed enterprise agreement in February 2018.
7 In about July 2018, the Union provided Botany Cranes with a further version of a proposed enterprise agreement (the CFMMEU proposed EBA). Mr Griffiths did not agree to or accept the CFMMEU proposed EBA. In August 2018, Botany Cranes provided a copy of its proposed enterprise agreement to the Union. Botany Cranes’ employees voted to approve the CFMMEU proposed EBA on 23 August 2018.
8 In September 2018, the Union commenced proceedings in the Fair Work Commission seeking approval of the CFMMEU proposed EBA under s 185 of the Fair Work Act 2009 (Cth). The Union alleged, and Botany Cranes denied, that Botany Cranes had accepted the CFMMEU proposed EBA.
9 On 11 December 2018, the Fair Work Commission dismissed the Union’s application: Construction, Forestry, Maritime, Mining and Energy Union [2018] FWC 6708 (the dismissal decision). On 24 January 2019, a Full Bench of the Fair Work Commission heard the Union’s appeal against the dismissal decision and reserved its decision.
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128 Having demonstrated how coercive and intimidating the Union could be on 25 January 2019, Michael Greenfield told Mr Griffiths on 30 January 2019 that worse was in store for him and his company unless Botany Cranes capitulated to the Union’s demand that Mr Byrnes be reinstated. That circumstance evinced that Michael Greenfield and the Union had no regard or respect for the rule of law, genuine bargaining at the workplace or respect for the rights of building industry participants, such as Botany Cranes: see ss 3(2)(b)–(d) and 81(6)(c) of the Act. He told Mr Griffiths on 30 January 2019 that the Union would agree to his terms for the new enterprise agreement, would withdraw the appeal to the Full Bench of the Fair Work Commission and that “Everything against you will cease”. It is obvious that was, at the very least, inaccurate, given what Michael Greenfield said the next day (see par 53 of the agreed facts).
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136 Secondly, on 31 January and 1 February 2019, the Union, again through Michael Greenfield, deliberately set out to achieve, through the use of unlawful pressure, the object sought in the Union’s appeal to the Full Bench of the Fair Work Commission (in which the decision had been reserved after the hearing on 24 January 2019). Thus, the undue pressure applied, in contravention of s 54(1), sought to achieve, unlawfully, a result for which there was a mechanism provided in the Fair Work Act.
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151 His [that is, Michael Greenfield’s] contravention of s 54(1) on 31 January and 1 February 2019 involved a further increase in the intensity of his and the Union’s bullying tactics. The conduct extended over two days and again involved the calculated menace reflected in his speech on 25 January 2019, namely: “the f…king law is stacked against us, but we continue to do it the way we do it”. It is essential that the Union stop doing “it”, namely using coercion and undue, unlawful, illegitimate and unconscionable pressure to impose its will. Here, the Full Bench of the Fair Work Commission, on 24 January 2019, had reserved its decision in the Union’s appeal about whether Botany Cranes had agreed to the CFMMEU proposed EBA so that it should be approved. The Union did not want to run the risk of losing that appeal, so it resorted to applying undue pressure to compel Botany Carnes to bend to its will and avoid a lawful and fair resolution of the dispute. This conduct cannot be tolerated in our society. It strikes at the heart of the rule of law. I will impose a penalty of $35,000 on Michael Greenfield for that conduct. The total of penalties against him amounts to $100,000.
165 The Union and Michael Greenfield submit that the conclusions reached in [136] and [151] that the contraventions by him and thereby the Union on those two days were based on not wanting to lose the appeal to the Full Bench in the sense of a being a motivating factor were not the subject of any agreed fact, pleaded allegation or evidence, such that those findings were not open to his Honour. They were, it is contended, not an inference in the sense of being based upon facts supporting that conclusion, but rather, at most, mere speculation.
166 The Commissioner submits that the comments by the primary judge at [136] do not in terms attribute any motivation or intention on the part of Michael Greenfield, but accepts that [151] does attribute an intention (and thus motive) to the Union not to want to risk losing the appeal to the Full Bench and that there was no pleading or agreed fact or admission to that effect. However, the Commissioner submits that even absent that comment by his Honour, the conclusion that Michael Greenfield’s conduct struck at the heart of the rule of law and should not be tolerated was justified by the findings at [146] to [148], which are unchallenged and more serious than the comments at [151] that are challenged, such that this Court should not perceive any substantial difference being brought about by the impugned findings so as to result in any error in the exercise of discretion as to penalty. Those findings go to the characterisation of the conduct itself as being directed to achieve the objectives of having Mr Byrnes reinstated and the Union’s proposed EBA agreed to by Botany Cranes, rather than to any additional motivation behind engaging in that conduct.
167 The conclusion to be reached upon a careful consideration of the paragraphs of the primary judge’s reasons, both reproduced above and referred to above, and the competing arguments advanced, is that the Union and Michael Greenfield are correct in their argument that the primary judge had no stronger basis than speculation in finding that avoiding the risk of a loss in the appeal before the Full Bench was a motivation for the conduct, but that this did not in all the circumstances make any difference to the result in terms of the penalties imposed. As such, this error was not material. For that reason, this ground of appeal must fail. For completeness, it should be noted that this ground was in any event left with no work to do given the appellants’ success on grounds 14 to 16.
Grounds 25 to 27 – the cooperation discount
168 These grounds of appeal assert that the primary judge erred in the assessment of cooperation by failing to take into account:
(a) in respect of all of the appellants, the public benefit of the admissions made and other cooperation and by taking into account the absence of no real prospect of successfully defending the 25 January 2019 contraventions; and
(b) in relation to the Union and Michael Greenfield, by failing to take into account that the post-25 January 2019 contraventions were not the subject of objective evidence, including any police video footage.
169 It is not in doubt that cooperation with a regulator generally contributes to the assessment of the appropriate penalty for contravening conduct to whatever degree the judge imposing that penalty finds appropriate in weighing up the various and sometimes competing considerations. Cooperation may, for example, indicate acceptance of wrongdoing and a determination not to allow it to happen again, and thereby lessen the need for deterrence by reducing the extent of the penalty required to achieve compliance. Giving recognition to such conduct in that process may encourage others to cooperate, thereby freeing up the resources of a regulator (and in this case, a replacement regulator).
170 The real complaint now made is about the evaluation of the cooperation by the primary judge as part of the exercise of the penalty imposition discretion, an inherently difficult to thing to challenge as but one of the factors going into the mix, not being a mere mathematical exercise of addition and subtraction. In particular, it is difficult to characterise any particular feature of a case as constituting a mandatory relevant consideration, or a forbidden irrelevant consideration, as opposed to being something that is found to carry greater or lesser significance in the exercise of the discretion. It is essentially evaluative in nature, being a particularly difficult area for appellate intervention.
171 The primary judge at [114] said:
The Union is well-resourced and financially substantial, as is the branch. In pecuniary penalty proceedings, the Union frequently does what occurred in this proceeding; namely, agree facts so that the Court can impose penalties without requiring witnesses, including not only the persons adversely affected by contravening conduct but also the officials and members of the Union who engaged in that conduct, to give evidence. I accept that this has a benefit in avoiding the persons affected by the contravening conduct from having to give evidence in Court. But, in this case, that benefit occurred only after extensive interlocutory processes, in circumstances where, as the agreed facts, including the subpoenaed police video, revealed, there was no real prospect of a defence to the allegations of the contraventions on 25 January 2019, except perhaps as to the identity of the organiser, given what appeared to be Mr Kera’s role.
172 The complaint made about this above by the appellants is that while the primary judge acknowledged a utilitarian benefit in resolving the liability aspect of the proceeding and spared witnesses having to give evidence, the value of the admissions and cooperation in making them was diminished by his Honour’s perceptions of the prospects of a successful defence of the 25 January 2019 contraventions that had been alleged. This is said by the appellants to entail failing to take into account the outcome of the mediation resulting in a reduction in the number of contraventions pressed from 78 to 20, the removal of eight individual respondents, proceedings in relation to seven respondents in relation to 25 January 2019 being discontinued and allegations of contraventions of s 54 of the Act on 25 January 2019 not being maintained. The decision of Bromberg J in Australian Building and Construction Commissioner v Australian Workers’ Union [2021] FCA 861; 308 IR 195 (ABCC v AWU) at [45] is cited for the proposition that discontinuance after mediation may suggest that there was question of merit that required consideration.
173 Further, the appellants submit, the discontinuance of the proceeding against Darren Greenfield entailed an abandonment of allegations of contraventions in 2018. Moreover, it is argued, the contraventions pleaded were not limited to the picket on 25 January 2019 referred to by his Honour, but rather included alleged contraventions in 2018 and over the period from 30 January to 1 February 2019, which his Honour was not in a position to assess as to whether or not there was a viable defence. More generally, the appellants submit that the resolution of the proceeding as to what was pressed and what was admitted in terms of liability plainly involved compromise on both sides, including the features already identified, which demonstrated that there were real questions of merit as to the initial claim that was brought, and with there being no consideration of the saving of court time and the Commissioner’s resources. The combination of these features not being referred to is said to have led to a miscarriage of the exercise of the penalty imposition discretion.
174 The Commissioner casts a different light on the history of the proceeding, pointing to the following features:
(a) as to mediation, it could not reasonably be suggested that the discontinuance of claims against persons other than those against whom claims were maintained could have any bearing on the penalty to imposed on the appellants;
(b) discontinuance after mediation cannot, without more, be relied upon as suggesting that the discontinued allegations lacked merit;
(c) the primary judge was aware of and acknowledged the benefit of the settlement in avoiding a hearing on the merits, with the relevant consideration, as described in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113; 254 FCR 68 (The Queensland Children’s Hospital Appeal) at [104] being the extent to which there was cooperation with the regulator in the investigation and prosecution of the contraventions, being but one of a number of potentially relevant considerations which should not be “slavishly applied”, as noted by Bromberg J in ABCC v AWU at [28], but rather weighed according to the facts of each case;
(d) the individual appellants had relied on their privilege against exposure to a penalty, with the Union attempting impermissibly to do the same, and the appellants unsuccessfully sought to join Botany Cranes, Mr Griffiths and Ms Hodges as cross-defendants, requiring a hearing on the Commissioner’s evidential case, listed for 30 March 2020;
(e) the Commissioner’s evidence was first served on the appellants in August 2019, a court appointed mediation on 5 September 2019 was unsuccessful, and the appellants only compromised the proceedings at the last moment on 6 March 2020 after the filing of a joint tender bundle filed on 13 February 2020 and the exchange of written submissions for hearing;
(f) the appellants also sought by a fishing subpoena the production of the Commissioner’s file on the investigation of the picket, which had to be set aside, being the “extensive interlocutory processes” referred to by the primary judge;
(g) the primary judge weighed the ultimate cooperation in its context and took the view that it reflected nothing more than the inevitable in relation to the 25 January 2019 allegations, an approach endorsed by The Queensland Children’s Hospital Appeal at [164];
(h) to the extent that the primary judge took that view in relation to the contraventions that occurred after 25 January 2019, these are characterised as being admitted in damning terms in the agreed facts at [44] to [51] and [53] to [57];
(i) the primary Judge’s consideration of the appellant’s cooperation was not inadequate, let alone to the point of error, as the primary judge was entitled on the facts to take the view he did of the extent and nature of the cooperation.
175 In reply, the appellants point out that the Commissioner does not dispute that the primary judge failed to take into account the saving of court time expressly. The better view is that his Honour did not necessarily have to spell out something that would have been obvious to him and was in any event part and parcel of witnesses not having to give evidence.
176 The appellants also submit in reply that the outcome of the mediation indicates that there was at least a real prospect that there was a defence to multiple of the contraventions that were abandoned. It is not apparent how the primary judge was meant to assess claims the prospects for claims that were not pressed and not litigated. Finally, the appellants suggest that the Commissioner does not attempt to defend his Honour’s asserted apparent view that the appellant’s position in relation to defending the contraventions post-25 January 2019 was not tenable. It is not readily apparent that his Honour reached any such view.
177 The appellant’s arguments amount to no more than indicating that the primary judge could have reached a different conclusion as to cooperation and that, in doing so, other features could have been expressly taken into account in addition to those his Honour considered to be important enough to articulate. Cooperation was but one factor to be taken into account in the weighing of the competing considerations. His Honour, having been the docket judge for some time, was entitled to confine consideration to those features of this aspect that were expressly identified by him as having a material bearing on the exercise of his discretion. No error has been established by his Honour not saying more about other features, or by not giving more or less weight to the features that were identified. These grounds of appeal must fail.
Ground 28 – failure to take into account an absence of proven loss
178 As relevant to this ground of appeal, s 81 of the Act provides as follows (emphasis added):
81 Penalty etc. for contravention of civil remedy provision
(1) A relevant court, on application by an authorised applicant, may make one or more of the following orders relating to a person (the defendant) who has contravened a civil remedy provision:
(a) an order imposing a pecuniary penalty on the defendant;
(b) an order requiring the defendant to pay a specified amount to another person as compensation for damage suffered by the other person as a result of the contravention;
(c) any other order that the court considers appropriate.
…
(6) In determining a pecuniary penalty under paragraph (1)(a), the court must take into account all relevant matters, including:
(a) the nature and extent of the contravention; and
(b) the nature and extent of any loss or damage suffered because of the contravention; and
(c) the circumstances in which the contravention took place; and
(d) whether the person has previously been found by a court (including a court in a foreign country) to have engaged in any similar conduct.
179 This ground relies upon the terms of s 81(6)(b) as constituting a mandatory relevant consideration which the primary judge is said to have failed to take into account in relation to the contraventions on 30 January 2019 and 31 January to 1 February 2019, being that there was no specifically identified and proven loss of profit or productivity by Botany Cranes.
180 The agreed facts state:
23. After the termination of Byrnes on 24 January 2019, the CFMMEU circulated to all its members, including Botany Cranes employees, a text message calling on them to attend at the Botany Cranes Yard on 25 January 2019 to protest against the termination of Byrnes's employment. A copy of the text was received by Griffiths on 24 January 2019.
24. As a consequence of receiving the text, Hodges arranged for Botany Cranes to sub-contract or cancel some of its jobs scheduled for 25 January 2019, causing Botany Cranes to lose revenue of approximately $31,723.50 and an amount of profit.
181 Beyond the above, no evidence of loss or damage suffered by Botany Cranes is identified, nor apparently proven.
182 The primary judge relevantly said:
(a) on the topic of the principles to be applied in the imposition of a civil penalty:
94 The key principles for the fixing of a civil penalty are clear; yet, there has been an efflorescence of case law on the subject that has led to parties citing a plethora of authority on applications such as this. Here, the Parliament prescribed, in s 81(6) of the Act, the mandatory relevant considerations for the imposition of a penalty under s 81(1)(a). Those considerations are to take into account, as one might expect in a statute requiring a judicial evaluation of the penalty that a court is to impose, “all relevant matters”, including: the nature and extent of the contravention, as well as any loss or damage suffered because of it; the circumstances in which it took place; and whether the person has previously been found by a court to have engaged in any similar conduct.
(b) on the topic of whether part of the penalties ordered to be paid should be paid to third parties:
124 On 25 January 2019, as a matter of common sense and experience, Botany Cranes would have had fixed overheads and other costs that its lost revenue of $31,723.50 for the day would have covered. It also lost the potential to have earned a profit from the balance of the lost revenue. Even if it could have earned that revenue by performing the cancelled or postponed jobs later, it may not have been able to take on additional work on those days. It is neither possible nor necessary to fix a precise sum to measure any loss that Botany Cranes suffered as a result of the disruption that the contraventions caused because the Commissioner has not sought any compensation for it under s 81(1)(b). However, s 81(5) authorises the Court to order that part of the penalty that a defendant should pay, instead be paid as a penalty (not compensation) to another person. The power in s 81(1)(a) to impose a pecuniary penalty to which s 81(5) is directed is different to the power conferred in s 81(1)(b), to order that the defendant in addition pay compensation. I consider that, as the Commissioner sought in final address, in the circumstances it is appropriate to order, under s 81(5) that, as part of the penalties imposed on it for its contravention of s 47(1) on 25 January 2019, the Union pay $30,000 as a pecuniary penalty to Botany Cranes.
183 The appellants’ argument depends upon two evidentiary features of the case before the primary judge. First, that there was no evidence or assertion of any loss or damage arising from the contraventions of s 52(a) on 30 January 2019, or from the contraventions of s 54(1) on 31 January to 1 February 2019. Secondly, that while there was evidence of a loss of revenue on 25 January 2019 as per above, there was no evidence of actual economic loss to Botany Cranes and no compensation was sought. The effect of the appellants’ submissions is that s 81(6)(b) required not only that any positive evidence of loss or damage was required to be taken into account, but also that the absence of evidence to that effect was also required to be taken into account.
184 On an ordinary reading of s 81(6)(b), it might have been thought that the obligation imposed was to take into account in fixing a civil penalty the nature and extent of any loss or damage shown to have been suffered because of the contravention. However, the appellants rely upon Optus Singtel Pty Ltd v Australian Competition and Consumer Commission [2012] FCAFC 20; 287 ALR 249 to suggest that the absence of any loss or damage must also be considered (emphasis added to the last paragraph reproduced):
Little loss to consumers
56 Optus submits that the primary judge failed to give appropriate weight to his finding that little or no loss was suffered by consumers as a result of the campaign. Optus points to s 76E(2)(a) of the Act which places a mandatory obligation on the Court to have regard to loss or damage flowing from the contravention. Optus contends that his Honour failed to have regard, or sufficient regard, to this provision.
57 Many circumstances of the present case support a substantial penalty even though the campaign did not cause loss to consumers. Further, the absence of evidence of loss to consumers was expressly recognised by his Honour at [33] of the reasons. The primary judge weighed this factor against the broad range of considerations relevant to the exercise of the discretion conferred by s 76E(1) of the Act. We reject Optus’ argument that his Honour erred in this regard. It is also pertinent to note that, while “little loss or damage has been suffered by consumers on this occasion”, Optus persisted in the prosecution of its campaign until restrained by orders of the Court.
58 Turning to the ACCC’s contention, the very existence of s 76E(2)(c) suggests that a contravention which has caused substantial loss or damage to consumers should, all other things being equal, attract a more severe penalty than a contravention which has not. The absence of loss or damage to consumers is a circumstance which would usually attract a less severe penalty than if substantial harm had been inflicted on consumers. We would respectfully adopt the conclusion of the primary judge that the absence of such evidence, in a case such as this, constitutes a factor in mitigation of penalty and we do so for the reasons referred to by the primary judge in his earlier decision in ACCC v MSY Technology Pty Ltd (No 2) (2011) 279 ALR 609 at [77]-[80].
185 It transpires that the reference to mitigation in the portion in bold is more nuanced than is readily apparent without regard to what Perram J said in the passages in Australian Competition and Consumer Commission v MSY Technology Pty Ltd (No 2) [2011] FCA 382; 279 ALR 609 at [77]-[80] cited above, which reveal that the circumstance of lack of loss or harm may be a factor calling for a lesser penalty when the ordinary expectation, especially in a consumer protection case, is that loss or damage would have resulted. Perram J said in MSY Technology:
The amount of loss or damage caused (s 76E(2)(a))
77 Neither party is aware of whether actual loss or damage was caused by the contravening conduct. The parties’ agreed written submissions argued that the absence of loss or damage or the inability to quantify accurately the extent of loss or damage is not a mitigating factor in the imposition of a penalty. Reliance was placed upon Trade Practices Commission v ICI Australia Operations Pty Ltd (1991) 105 ALR 115; and Australian Competition and Consumer Commission v Roche Vitamins Australia Pty Ltd (2001) ATPR 41-809 (“Roche Vitamins”).
78 Ms Beaumont, of counsel, who appeared for the respondents, submitted orally that Trade Practices Commission v ICI Australia Operations Pty Ltd is not really authority for that proposition. In that case Olney J said (at 119):
However, I do not think that the absence of loss or damage is necessarily a mitigating factor. In a case where the breach of the Act is an attempt to induce a reseller to impose a minimum price for goods supplied to the reseller, the question of loss or damage will rarely, if ever, arise. The Act does not distinguish in terms of culpability between the various types of conduct which constitute the practice of resale price maintenance.
79 I accept Ms Beaumont’s submission. The passage in question is directed to a situation where loss and damage rarely arises and where, therefore, its absence can hardly be seen as a mitigating matter. In cases where, as here, it is easy to imagine detriment to consumers I would accept that the absence of any evidence of suggested harm should be regarded as a mitigating factor. The reason for this is no more than commonsense: if harm is likely to have been suffered by reason of the contravening conduct but no evidence is led which suggests that it was, the respondent is entitled to be sentenced on the basis that the conduct has not caused harm which, plainly enough, will be a mitigating circumstance.
186 While a case such as the present may not fall into the category of being where loss and damage rarely arises, unlike a consumer case, in a given case under the present Act there may not be any starting point expectation that loss or damage is likely in any given case. For some cases, the likelihood of loss or damage may be significant, such as where all trading is forced to cease. In others, such as where there is a short altercation, pause or even temporary shutdown, loss or damage might be seen to be unlikely. Thus, the particular facts and circumstances may have a bearing on the application of s 81(6)(b) of the Act.
187 In Trade Practices Commission v ICI Australia Operations Pty Ltd (1991) 105 ALR 115, referred to by Perram J above and quoted by his Honour, Olney J in this Court was dealing with the imposition of civil penalties for resale price maintenance contraventions, and the circumstance that in such cases the question of loss or damage will not ordinarily arise. It follows from this reasoning that the question of whether an obligation was imposed upon the primary judge by s 81(6)(b), and therefore whether there was a failure to comply with that obligation, can be seen to have depended upon the nature of the case that his Honour was addressing, and whether it was one in which, absent evidence, loss or damage of some kind was to be expected to occur. If that was present, the absence of loss or damage may need to be addressed as its absence would be out of the ordinary and therefore able to be viewed as a factor in mitigation relative to other such cases.
188 The Commissioner submits that the findings made by the primary judge at [124], reproduced above, about overheads not being covered by the loss of revenue was a reasonable inference to draw about any business operation and notes that his Honour did not take those matters into consideration in assessing the penalties for the contraventions on 25 January 2019 because they were dealt with by making compensation orders under s 81(5) as also described at [124]. The Commissioner submits that it was not necessary for the primary judge to take into account any absence of loss or damage when it came to determining the penalties to be imposed for the contraventions on 30 and 31 January and 1 February 2019, because that is not the requirement under s 81(6)(b). Rather, the Commissioner submits, the contraventions are to be assessed as to penalty in the normal course on the basis that no damage was caused. Thus, it is submitted, this is not a factor that gives rise to any reason to impose a lesser penalty that no loss or damage was caused.
189 The above authorities support the conclusion that the meaning to be given to s 81(6)(b) is not as black or white as either side suggests. How the matter of loss or damage is to be taken into account depends on the facts and circumstances of the case at hand. This is not a question that is readily amenable to prescriptive rules or tests, but rather upon a basis that may include a holistic assessment as to whether or not there is any issue as to loss or damage being absent or present that needs to be addressed in some way.
190 The primary judge was expressly cognisant of the terms of s 81(6)(b), and addressed it in relation to the contraventions on 25 January 2019, choosing to meet it by way of a compensation order, addressed earlier in these reasons. There is no proper basis for concluding that his Honour proceeded upon the basis of any expectation that, even absent evidence that no loss or damage had been incurred, loss or damage would have been expected to have been incurred due to the contraventions in the period from 30 January to 1 February 2019. His Honour must be taken to have approached the question of penalty imposition for those contraventions upon the basis that neither of the very early morning meetings on those two days had been shown to result in any actual loss or damage. Having regard to the reasons as a whole, we do not accept that his Honour imposed a heavier penalty by reason of not specifically addressing the absence of evidence that there had been such loss or damage in the absence of any identified basis for an expectation that this would have taken place.
191 The result is that the asserted error has not been established and this ground of appeal must fail.
Grounds 37, 38 and 40 – non-indemnification order against Mr Byrnes
192 The primary judge addressed the question of non-indemnification orders so that the Union would not be permitted to pay the penalties imposed upon its officials. His Honour addressed this topic succinctly as follows:
Non-indemnification orders
152 In my opinion, it is necessary to impose a non-indemnification order for each of the penalties I will impose on the officials so as to ensure specific and general deterrence: the Non-Indemnification Case 262 CLR at 196–197 [118]–[120], 203–204 [133] per Keane, Nettle and Gordon JJ; see too the Constitution Place Case 299 IR at 278 [210]. In Ms Mallia’s and Mr Kera’s cases, they should have to pay all of the penalties personally. In Michael Greenfield’s case, I will make a non-indemnification order that he personally pay $65,000 so as to ensure that he is deterred in the future from engaging in such contraventions of the law.
153 The Commissioner did not seek a non-indemnification order in respect of Mr Byrnes. However, having considered the position, and subject to what may emerge in the submissions that I will receive, my provisional view is that I should impose such an order on him for at least some of the penalty so as to achieve a real measure of deterrence and to convey to Mr Byrnes and others that if they contravene the law, they personally will have to pay the penalties for doing so. I will allow Mr Byrnes and the Commissioner the opportunity to make submissions on this issue.
193 Subsequently, in ABCC v CFMMEU (No 4) (Botany Cranes Case) [2021] FCA 525, his Honour said:
5 The Commissioner confirmed that he did not seek a non-indemnification or personal payment order in respect of Mr Byrnes, who made common cause with him on this issue. In particular, Mr Byrnes argued that he had admitted liability on the basis that no such order was, or would be, sought and that settlements would be discouraged if it were now made. Mr Byrnes contended that, if I made a non-indemnification order despite the combined stance of the parties, predictability in civil penalty proceedings would be undermined and that he would suffer significant injustice, since he could not now withdraw his admissions. He relied on what Rangiah J had held recently in Australian Building and Construction Commissioner v Construction, Forestry, Maritime, Mining and Energy Union (The North Queensland Stadium Case) (No 2) [2021] FCA 105 at [69]–[70].
194 The primary judge then at [18] to [29] gave reasons for imposing a non-indemnification order in relation to part of the penalty imposed upon Mr Byrnes, despite the Commissioner not seeking it, and Mr Byrnes opposing it. The gravamen of his Honour’s reasoning can be summarised as follows:
(a) Pursuant to the power under s 81(1)(a) of the Act, a person can be ordered to pay pecuniary penalties personally. That is to ensure the effect of the order to pay the penalty will carry with it “the reality of a pecuniary penalty which is critical to the attainment of the deterrent effect which is the very point of the penalty” citing Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3; 262 CLR 157 (The Non-Indemnification Case) at [44] per Kiefel CJ.
(b) The power in s 81(1)(a) enables the imposition of a penalty to accomplish the legislative purpose of specific and general deterrence: The Non-Indemnification Case per Kiefel CJ at [44], [49] and per Keane, Nettle and Gordon JJ at [125], the latter referring to the exercise as “one of accomplishing the level of sting or burden which the court determines is necessary to be imposed … to achieve the appropriate degree of deterrence.”
(c) The proposition that if an employee of a Union participates in contravening conduct during the course of their employment as directed or authorised by the Union, ordinarily an expectation may arise that the Union indemnify them against payment of the penalty should be rejected because, at [22]:
It is no part of the duty of the Court, in exercise of the judicial power of the Commonwealth, to recognise or encourage an expectation that an employee or agent can be indemnified from bearing the sting or burden of a pecuniary penalty for contravening the law in performance of an activity, directed, authorised or encouraged by the employer. The employee is bound to obey the law as enacted by Parliament, regardless of any instruction or expectation of his employer to do otherwise, and the Court is bound to enforce the law.
(d) It is wrong in principle to regard a non-indemnification or personal payment order as distinct from the actual imposition of a civil penalty, but rather is part and parcel of the penalty directed to the purpose of achieving the statutory purpose of deterrence, reiterating the notion drawn from The Non-Indemnification Case reproduced above that the exercise of imposing pecuniary penalties is one that carries with it the power to ensure the sting or burden is effective.
(e) The Court is not bound, when imposing pecuniary penalties, by any agreement by the parties. After hearing from Mr Byrnes on the question of whether his Honour should impose a non-indemnification or personal payment order, deterrence still held primacy in ensuring that he and others will not engage in similar contravening conduct to that in which he engaged on 25 January 2019 and because the Union has embedded culture to treat the payment of penalties as a price of doing business.
(f) Mr Byrnes did not express any contrition or acknowledgement that his conduct was unacceptable and while his agreement to the facts had some utilitarian value, the evidence in the videos of the unlawful picket in evidence establishing his participation in the contravening conduct alone would have made such findings inevitable. As such, justice and the statutory objective of deterrence would not be served by making an order that merely allows the Union to pay, as the Union and Mr Byrnes intended. It is Mr Byrnes and the Union that must be put on notice that they personally, and not the Union, will be required by the Court to answer with their personal resources and finances as a consequence of any contravening conduct.
195 The appeal grounds maintained in relation to the non-indemnification order made in relation to the penalty imposed upon Mr Byrne are that the primary judge erred:
(a) in making the order when it was not sought by the Commissioner and had submitted that such an order was not appropriate;
(b) by failing to take into account the public interest in promoting the predictability of outcomes in civil penalty proceedings; and
(c) in concluding that there was no prejudice to Mr Byrnes in making the order when it had serious practical and legal consequences, he had agreed to resolve the proceeding on the basis that no such order would be sought against him and if such an order had been sought it may have influenced his conduct of the proceeding.
196 The submissions made in support of those grounds largely replicate them without further elaboration. However, a further submission was made by the appellants that the imposition of a non-indemnification order in circumstance where Mr Byrnes had been induced into a settlement which he might have potentially contested was unreasonable and unjust.
197 The Commissioner’s response in writing and not expanded upon in oral submissions is to submit that these grounds of appeal should be dismissed because:
(a) the stance taken by the Commissioner did not go so far as to submit to the primary judge that the order was inappropriate, but did submit that it was not sought and was a matter for his Honour’s exercise of discretion;
(b) that such an order was not sought by the Commissioner and was opposed by Mr Byrnes and by the Union was acknowledged by his Honour;
(c) in relation to the public interest in promoting predictability, his Honour did not fail to take that submission into account, but rather, while acknowledging it, addressed it by reference to the statement in Volkswagen Aktiengesellschaft v Australian Competition and Consumer Commission [2021] FCAFC 49; 284 FCR 24 at [126] that agreement between parties as to penalty as a measure of predictability was only one consideration and cannot override the statutory requirement to impose an appropriate penalty, such that the Commissioner’s stance was not binding on his Honour;
(d) his Honour was correct to dismiss the suggestion that any expectation that Mr Byrnes had that the Union would pay any penalty he incurred did not confine the Court’s discretion;
(e) his Honour found that it was necessary for the purposes of specific and general deterrence that the order be made and the considerations taken into account by his Honour are not challenged;
(f) his Honour was entitled to find that there was no prejudice when the contravention warranted the imposition of a penalty accompanied by such an order in order to avoid the penalty having no impact on the contravener, when the prejudice is said to arise from the expectation that the Union would pay the penalty, which was also consistent with the rejection of the assumption that such an expectation affected the capacity of his Honour to make appropriate orders;
(g) to the extent that other assertions of prejudice are made, it is unclear how they constitute or establish House v The King error;
(h) while the penalty accompanied by the order has serious consequences for Mr Byrnes, that is the point of deterrence, and he gave no evidence that he had agreed to resolve the proceeding on the basis that the order was not sought or that if such an order was sought it would have influenced his conduct of the proceeding.
198 The appellants’ reply submission assert that the mere fact that the primary judge recorded the submissions made about the public interest in predictability of outcomes in civil penalty proceedings and cited Volkswagen did not mean that his Honour actually took that into account. In other words, the appellants submit that the argument advanced was rejected but not grappled with by the primary judge, especially as the part of Volkswagen dealing with the predictability of outcomes are not referred to. This is not a tenable submission to make. The recording of the submissions made is a sufficient basis for concluding that his Honour took them into account. It is also reasserted that Mr Byrnes had agreed to resolve the proceeding upon the basis of the order not being sought, and that it is an extraordinary order by imposing strictures that do not ordinarily apply when a penalty is imposed, and the prejudices relied upon were articulated without objection as to any evidentiary shortcoming, such that his Honour erred in disregarding them.
199 In resolving the competing arguments, it is important to remember that asserted error in the exercise of discretion must rise higher than mere disagreement, or the appeal court being of the view that it might have proceeded differently or reached a different conclusion. Error must be established.
200 The primary judge’s approach to the order made was undoubtedly stern, and may even be seen to be counter-productive in discouraging concessions being made or accepted as part of a settlement process. If so, that is regrettable and undesirable and may not be a course that other judges would follow. However, the Commissioner’s arguments are correct and the Union and Mr Byrnes have not established that the necessary error is present. His Honour was not obliged to treat the agreement by the Commissioner not to seek the order, and any expectation on the part of Mr Byrnes that the result would be that it would not be made because of that agreement, as confining his discretion to make the order. His Honour has not been shown to err in finding that making such an order, even in the unfortunate circumstances that were present, was part of imposing an appropriate penalty with the necessary deterrent effect.
Re-exercise of discretion to impose penalties
201 As earlier stated, the parties accepted that to the extent the appeal was successful, we should re-exercise the discretion to impose penalties. The appeal has been successful in part. The following penalties imposed by the primary judge’s orders of 19 May 2021 will be set aside and the penalties in question need to be re-determined:
(a) in respect of Mr Kera:
(i) $35,000 in respect of his s 52(a) contravention on 25 January 2019; and
(ii) $12,500 in respect of his s 47(1) contravention on 25 January 2019.
(b) in respect of Michael Greenfield:
(i) $25,000 in respect of his s 52(a) contravention on 25 January 2019;
(ii) $10,000 in respect of his s 47(1) contravention on 25 January 2019; and
(iii) $35,000 in respect of his s 54 contravention on 31 January and 1 February 2019
(c) in respect of Ms Mallia:
(i) $15,000 in respect of her s 52(a) contravention on 25 January 2019; and
(ii) $5,000 in respect of her s 47(1) contravention on 25 January 2019.
(d) in respect of Mr Byrnes;
(i) $3,500 in respect of his s 52(a) contravention on 25 January 2019; and
(ii) $1,500 in respect of his s 47(1) contravention on 25 January 2019.
(e) in respect of the CFMMEU:
(i) $500,000 in respect of its contraventions of ss 47(1) and 52(a) on 25 January 2019; and
(ii) $175,000 in respect of its contravention of s 54(1) on 31 January and 1 February 2019.
202 In consequence of those orders being set aside, the non-indemnification orders as well as orders made by the primary judge that part of the penalty imposed upon the CFMMEU be paid to persons other than the Commonwealth of Australia will need to be set aside and revisited.
203 Out of the penalty of $500,000 imposed on the CFMMEU for its contraventions on 25 January 2019, the primary judge ordered that $30,000 be paid to Botany Cranes, $2,500 be paid to the Operations Manager of Botany Cranes, Rhonda Hodges and $15,000 be paid to the NSW Police Force, with the balance to be paid to the Commonwealth. For the purpose of considering whether any penalty which is reimposed should be paid to a person other than the Commonwealth, each of the persons or organisations just referred to were contacted and asked to provide any submission they sought to make regarding to whom any penalty or parts thereof should be payable, if a penalty should be re-imposed on the CFMMEU. Submissions were received from each of those persons. Ms Hodges’s substantive response was to the effect that the penalties previously imposed were “minor for the PTSD that [she] suffered at the hands of the CFM[M]EU”. We take that response to contend that a larger payment should be ordered in favour of Ms Hodges. A representative of the NSW Police Force submitted that if the Full Court were to determine a penalty was to be reimposed, the NSW Police Force should be paid part of that penalty. The NSW Police Force rely specifically on the Second Reasons at [3], [15] and [16] and First Reasons at [124]-[126]. Botany Cranes contended that its loss of revenue should be taken into account in the exercise of the Court’s discretion to require that $30,000 of any penalty imposed upon the CFMMEU be payable to it. It further stated, without explaining why, that such a requirement would reinforce the deterrent effect of any penalty imposed upon the CFMMEU.
204 An appellate court’s determination of an appropriate penalty in the exercise of a discretion to impose a penalty, is usually made on the basis of the material placed before the Court at first instance and the primary judge’s unchallenged factual findings: Transport Workers’ Union of Australia v Registered Organisations Commissioner (No 2) (2018) 267 FCR 40 at [124]. In this case the primary judge’s factual findings are largely unchallenged. Beyond relying on the unchallenged findings, we have had regard to the material placed before the Court at first instance described above at [7].
Applicable principles
205 Section 81(1)(a) of the Act empowers the Court to make an order imposing a pecuniary penalty upon a person who has contravened a civil remedy provision provided for by the Act. Section 81(6) has already been referred to. By reason of that provision the Court must take into account all relevant matters, including:
(a) the nature and extent of the contravention; and
(b) the nature and extent of any loss or damage suffered because of the contravention; and
(c) the circumstances in which the contravention took place; and
(d) whether the person has previously been found by a court (including a court in a foreign country) to have engaged in any similar conduct.
206 Furthermore, we consider that we should have regard to the principles set out in Pattinson. In Pattinson, the High Court considered the scope of the power conferred by s 546 of the Fair Work Act to order a person to pay a pecuniary penalty that the court considers “is appropriate”. Although s 81(1)(a) is differently worded, it is implicit, including from the terms of s 81(1)(c) which empowers a court to make “any other order that the court considers appropriate”, that a pecuniary penalty order imposed under s 81(1)(a) must impose a penalty that the court considers is appropriate.
207 In that respect, whilst not intended to be exhaustive of the guidance provided by Pattinson, we consider the following observations made in Pattinson by Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ as of most significance to our present task:
(a) The purpose of a civil penalty is primarily, if not solely, the deterrence (both specific and general) of future contraventions (at [9]);
(b) The maximum available penalty is not to be reserved for only the most serious examples of offending but is available to be imposed where it is reasonably necessary to achieve the deterrence of future contraventions (at [10]). However, it does not follow that the power to impose a penalty “must be taken to require the imposition of a penalty approaching the maximum in relation to any and every contravention by a recidivist offender” (at [46]);
(c) An “appropriate” penalty is one that strikes a “reasonable balance between oppressive severity and the need for deterrence in respect of the particular case” (at [46]);
(d) Both the circumstances of the contravener and the circumstances of the contravention (i.e. the seriousness of the contravention) may be relevant to the assessment of the appropriate penalty (at [19] and [57]);
(e) The penalty appropriate to protect the public interest by deterring future contraventions may be “moderated” by a range of factors of the kind adverted to by French J in Trade Practices Commission v CSR Limited (1991) ATPR 41–076 (at [47]). However, the list of possible relevant considerations set out by French J ought not be treated as if it were a legal check list (at [19]).
The 25 January 2019 contraventions of ss 47(1) and 52(a)
208 As discussed in relation to grounds 6 to 13, for each contravener the primary judge should have treated the 25 January 2019 conduct in relation to the contravention of s 47(1) and that in contravention of s 52 to be “the same conduct” for the purposes of s 83(2) and applied that provision to impose a single pecuniary penalty in respect of that conduct. Furthermore, as discussed in relation to grounds 1 to 4, in respect of the 25 January 2019 conduct of the CFMMEU, the primary judge erred in finding eight contraventions – four in relation to s 47(1) and four in relation to s 52(a). For the reasons given above, the CFMMEU contravened each of those provisions once and given that each contravention involved the same conduct, s 83(2) requires that only one pecuniary penalty be imposed in relation to that conduct. Likewise, s 83(2) requires that a single penalty be imposed for the contraventions of ss 47(1) and 52(a) by each of the individual contraveners. There is no particular reason for regarding either the contraventions of s 47(1) or the contraventions of s 52 as the leading contraventions. However, as the picket provided the context in which the s 47(1) contraventions occurred, we will proceed on the basis that a single pecuniary penalty should, in each case, be imposed for a contravention of s 47(1).
209 The maximum penalty for each of the contraventions of the pecuniary penalty provisions in question by the CFMMEU is $210,000 and for each of the individuals is $42,000.
210 The background matters relevant to the picketing conduct of 25 January 2019 have been set out already. A description of the premises of Botany Cranes which were the subject of the picket is given at [5] above. At [19] above, we have broadly described the picket which took place on 25 January 2019 following the termination of the employment of Mr Byrnes by Botany Cranes on 24 January 2019. The admissions made in relation to the activities of the persons involved in the picket are set out at [20] and include their industrial motivations for their actions. Additionally, the primary judge made unchallenged findings about the participation in the picket of each of Mr Kera, Michael Greenfield, Ms Mallia and Mr Byrnes at [65]-[70] and [77] of the First Reasons as follows (emphasis in original):
65 Mr Kera addressed to the group and told them that they were “going to fight to the death” to have Mr Byrnes reinstated. He said that Botany Cranes had picked a fight with the Union and “we’re going to accommodate them”. He told them that Botany Cranes would “cop it straight between the eyes”; that its workers had not had a pay rise in 3.5 years, other than a $1.50 increase; that it had “double-crossed” the Union over the CFMMEU proposed EBA by refusing to sign it after agreeing to do so and that they were “going to wipe the floor” with Botany Cranes like the Union had done with WGC Cranes, after what he said was a two-week protected industrial action campaign, and Boom Logistics, after a five-week campaign (agreed facts pars 27(g) and 54). His tone and language, as recorded in the police video, was threatening and inflammatory, while asserting to his audience that it was to be “a peaceful protest”. His speech produced rousing cheers.
66 Mr Kera spoke as a senior official of the Union to the group that was already assembled. That engagement in the activities at the yard on 25 January 2019 was different to the conduct of anyone else. Of course, Mr Kera also engaged in the unlawful picket in concert with the other people in the group, and in that way contributed to its overall impact. But, his speech and later conduct in controlling the egress of persons from the yard was singular and distinct from the others.
67 Michael Greenfield addressed the group next. He thanked them for coming and said “This is the only way we are going to achieve anything”. He said that Mr Kera had “covered everything”, that Botany Cranes’ action in dismissing Mr Byrnes was “as illegal as it gets and they get away with murder and the fucking law is stacked against us, but we continue to do it the way we do it” and “we’re not going to stop until he’s back” (emphasis added). His admitted role as organiser was different to and distinct from that of the others present, including the other officials.
68 The agreed facts state that Michael Greenfield organised the conduct and actions that constituted organisation in his contraventions of ss 47 and 52 without specifying any particular conduct or actions to distinguish whatever else he did from the limited description of the speeches and other activities ascribed to him, Ms Mallia, Mr Kera, Mr Byrnes and the group in the events that occurred in the unlawful picket and coercive action. I infer that Michael Greenfield (and the Union) admitted that he was the person who arranged for and rallied persons, including the other officials, to attend the yard at 5:30am on 25 January 2019 to set up and carry on the unlawful picket and to pursue the coercive aim of having Mr Byrnes’ employment reinstated. That inference is the stronger because of the significant role Michael Greenfield played in the events of 30 January, 31 January and 1 February 2019.
69 Ms Mallia spoke briefly, and some content of what she said did not come over clearly in the police video because of her quieter voice and the police discussions, including organising to escort Ms Hodges into the yard, which occurred at the end of Ms Mallia’s speech and the beginning of Mr Byrnes’. Ms Mallia spoke as, and with the authority of, the branch president. She thanked and gave encouragement to the group to pursue the unlawful picket and to seek to coerce Botany Cranes to reinstate Mr Byrnes. Her involvement was, in one sense, of a lesser degree than that of Mr Kera and Michael Greenfield. But, her participation, as president, in the conduct was a powerful indication that the Union as a whole was there to demonstrate its commitment to achieving Mr Byrnes’ reinstatement by the coercive means that the two prec[e]ding speeches had stated with unmistakable directness.
70 Mr Byrnes spoke next. He was holding a megaphone. He explained, understandably, that he was upset by the loss of his job but heartened by the show of support for him of those present. He denigrated the present management of Botany Cranes as “the worst owner … I’ve ever witnessed in my whole life in the building industry”.
…
77 The activities of the group in the picket, including Michael Greenfield, lasted until about 4:00pm on 25 January 2019, well after the time (around 8:00am) that Mr Griffiths, Ms Hodges and other staff who were inside Botany Cranes’ premises had been allowed to leave with the assistance of the police. The chanting continued only to about 9:00am (agreed facts pars 31–34). The picket continued for longer and in a calmer manner after this time. The persons who engaged in it after 9:00am, including Mr Kera and Michael Greenfield, continued to do so with the motivations proscribed in s 47(2)(b)(i) and (ii), but the coercive impact of the speeches, chanting and aggressive behaviour during the early morning appears to have ceased around 9:00am.
211 Furthermore, the primary judge found in the First Reasons that:
(a) the picket involved no physical violence and that the picketers appeared to conform with police requirements (at [119]);
(b) the conduct of the picketers caused Ms Hodges to be fearful when she arrived and to seek police assistance to enter the yard of Botany Cranes in order to get to her place of work (at [119]);
(c) Ms Hodges’s fear caused her to tell the receptionist of Botany Cranes not to attend work for fear of her being intimidated and distressed by the conduct of the picketers (at [119]);
(d) the conduct of the picketers involved its members telling a mechanic employed by Botany Cranes, on his arrival for work, that he could not enter the yard and nor could anyone else, so that he did not attend work (at [120]);
(e) the actions and behaviour of the picketers caused the police to advise Botany Cranes that the picketers would not allow any cranes to leave the yard and that although staff and management could leave, the police would escort them for their own safety, due to the presence and conduct of the picketers. Further, that this caused Botany Cranes to form the view that their cranes could not leave the yard safely, that their office should be closed for the day and that the employees then at work should leave (at [120]);
(f) when vehicles left the yard of Botany Cranes some picketers yelled out “scum”, some made monkey noises and Michael Greenfield led more chanting (at [121]); and
(g) the conduct of the picketers, while not physically violent, was intimidatory and confronting and not a mere peaceful protest (at [122]).
212 Furthermore, the primary judge proceeded on the basis that Botany Cranes suffered some loss as a result of the disruption that the contraventions caused. Botany Cranes had lost revenue of $31,723.50 for the day as a consequence of the picket, although his Honour found it neither possible nor necessary to fix a precise sum to measure any actual loss suffered as a result of the disruption (at [124] of the First Reasons).
213 Those matters sufficiently address the nature and extent of the contravention (s 81(6)(a)), the nature and extent of the loss or damage suffered (s 81(6)(b)) and the circumstances in which the contraventions took place (s 81(6)(c)).
214 There can be no doubt that the conduct of each contravener was deliberate. We would infer, including from the finding of the primary judge that each of the contraveners were experienced and knowledgeable participants in the industrial system (at [137] of the First Reasons), that the conduct was engaged in by the contraveners in the knowledge that it was unlawful. Whilst the contraventions involved no violence or property damage, each contravention was nevertheless a serious contravention of s 47(1) of the Act warranting, for that reason alone, a substantial penalty to address the need for both specific and general deterrence.
215 The primary judge found that none of the contraveners had expressed any contrition, nor a recognition of the need not to repeat the contravening conduct (at [159] of the First Reasons). There is no evidence of any of the contraveners being disciplined or of any corrective action taken by the CFMMEU.
216 We have referred at [169] to the potential for cooperation with a regulator to lessen the need for deterrence. We have rejected grounds 25 to 27 of the appeal which challenged the primary judge’s assessment of cooperation despite the fact that it would appear that some weight was given to cooperation by the primary judge. We have relied upon our own assessment of what weight should be given to the cooperation shown by the contraveners, which included the making of significant admissions and a preparedness to agree the essential facts. In our view, whilst the cooperation provided was ultimately substantial, it may well have come earlier than it did. However, the available facts do not permit us to come to a firm view that the contraveners or any one of them should bear responsibility for their cooperation not coming earlier than it did. We regard the cooperation shown as justifying some moderation of the penalty to be imposed. In the case of the CFMMEU, taking into account the seriousness of its contravention and given its long history of non-compliance, the cooperation provided is the only factor which supports the conclusion that something short of the maximum penalty available would be an appropriate penalty.
217 Specific considerations relevant to the penalty to be imposed upon the CFMMEU include that senior officials of the Branch were involved in the CFMMEU’s contravention. Further, the CFMMEU was found by the primary judge to be “well-resourced and financially substantial” (at [114] of the First Reasons) and thus, we would infer, capable of paying a substantial penalty imposing an appropriate sting.
218 Furthermore, the primary judge found that the CFMMEU had a history of 172 contraventions between 2002 and July 2020 (at [110] of the First Reasons). The evidence reveals that there were 172 occasions where contraventions of industrial laws occurred and on many occasions there were multiple contraventions. The Branch and its officials accounted for 14 of those occasions.
219 Whilst the CFMMEU is a single legal entity, it can only act through its human agents and deterrence of the CFMMEU is ultimately deterrence of those human agents. In circumstances where the contravening conduct was organised by Branch officials without any suggestion of the involvement of federal officials or officials of other branches of the CFMMEU and where the rules of the Union provide to the Branch substantial autonomy in relation to the affairs of the Branch, the purpose of deterrence is best served by giving greater weight to the history of the contravention of industrial laws by the Branch than that of the CFMMEU generally.
220 However, whilst the Branch appears to have a relatively better history of compliance with industrial laws than does the CFMMEU as a whole, that history is sufficiently grave to cloak the Branch with the same characterisation available for the CFMMEU, of an organisation which countenances its human agents operating with contumacious disregard for industrial laws that stand in the way of achieving the Union’s industrial imperatives. It was asserted (and seems to be uncontested) that of the 14 occasions of past contraventions by the Branch, only one occurred in the last five years through to 2020. That may support an inference that past penalties imposed in relation to the contravening conduct of officials of the Branch has had a deterrent effect. However, the contravening conduct in question demonstrates a continued preparedness by officials of the Branch to disregard the law.
221 Taking all of those considerations into account, we consider that a penalty approaching the maximum would be an appropriate penalty which would strike a reasonable balance between oppressive severity and the need for a high level of specific deterrence demonstrated by the matters discussed. We will impose on the CFMMEU a penalty of $190,000 for its contravention of s 47(1) of the Act on 25 January 2019.
222 Ms Mallia has no history of prior contravention of industrial laws. She spoke briefly at the picket. There is no evidence suggesting that she engaged in any aggravating conduct other than that, as President of the Branch, her status may be said to have given some leadership to the picket and thus perhaps encouraged the participation or extent of participation of others. Taking into account all of the matters referred to already of relevance to her circumstances, a penalty of $15,000 is appropriate to meet the needs of both general and specific deterrence.
223 Mr Byrnes had no prior contravening history. He was a delegate but not a senior office-holder of the Branch. He had lost his job and he spoke to the picketers thanking them for their show of support. He was involved in chanting. He was upset by the loss of his job. His participation was unlawful and knowingly so. His conduct was not justifiable, but given his predicament and the fact that the picket was largely for his benefit, his participation was largely situational. The situation which motivated his unlawful conduct was somewhat exceptional and, together with the lack of evidence that he remains employed in the building industry, the need for specific deterrence is lower than what it may otherwise have been. Taking into account those and other matters relevant to his contravention discussed above, a penalty of $3,500 is appropriate.
224 Mr Kera has a number of prior contraventions of relevance. On 13 September 2017 a penalty of $41,250 was imposed upon him for coercive conduct and on 18 October 2018 a further penalty of $20,000. He was an Assistant Secretary of the Branch. He did not organise the picket but was a leading participant. It is apparent that the two penalties imposed on him not long prior to his involvement in the conduct in question, failed to have the deterrent effect they were intended to have. In all of the circumstances, a penalty at the high end of the range is appropriate. We will impose a penalty of $35,000.
225 Michael Greenfield had one contravention of relevance for which he was penalised $3,000 on 13 September 2017. He was also an Assistant Secretary of the Branch. He both organised and led the picket knowing it to be unlawful. A far heavier penalty than that last imposed is necessary to achieve the deterrence that the previous penalty failed to achieve. Taking that and his leading role into account, as well as the other considerations relevant to his circumstances as discussed above, we consider $25,000 to be an appropriate penalty.
The contraventions of s 54 on 31 January 2019 and 1 February 2019
226 The contraventions of s 54 of the Act concern demands made by Michael Greenfield to Mr Griffiths of Botany Cranes in furtherance of the CFMMEU’s attempts to make an enterprise agreement with Botany Cranes in the terms proposed by the CFMMEU. On 31 January 2019, Michael Greenfield relevantly stated:
If I were you, I’d fuckin’ sign it. You haven’t seen anywhere near bad yet. See what happened to WGC and Boom Logistics and they had money, what do you think will happen to you?
The next day on 1 February 2019 in a further conversation with Mr Griffiths, Mr Greenfield relevantly said:
If you sign the EBA we will leave your sites alone.
227 As discussed already, it was admitted that those comments were made by Michael Greenfield with an intent to apply undue pressure upon Botany Cranes to agree to make an enterprise agreement, but not admitted that Michael Griffiths held an intent to negate the will or choice of Botany Cranes. The conduct was clearly deliberate and a serious contravention of s 54(1) of the Act. There are however, reasons why the conduct should be regarded as somewhat less serious than the contravention by Michael Greenfield (and consequently the CFMMEU) of s 52 on 25 January 2019.
228 The conduct was brief. It was not accompanied by any other aggravating conduct or any loss such as that brought about by the picket on 25 January 2019. Unlike the conduct which occurred on that day, which also included Michael Greenfield seeking to apply illegitimate pressure upon Botany Cranes to make an enterprise agreement, Michael Greenfield did not have an intent to negate the will or choice of Botany Cranes.
229 The other matters of significance to the imposition of an appropriate penalty upon Mr Greenfield and consequently the CFMMEU are not relevantly different to those discussed in relation to the contraventions that occurred on 25 January 2019. For those reasons and taking into account the totality principle, because in part the 31 January and 1 February 2019 conduct involved a continuation of the same unlawful objective which motivated the conduct on 25 January 2019, a penalty of $18,000 on Michael Greenfield is appropriate and a penalty of $150,000 on the CFMMEU is appropriate to meet the need for both specific and general deterrence.
Personal payment orders
230 As earlier discussed in more detail, Mr Byrnes admitted liability for the contravention found against him on the basis that no non-indemnification order for any penalty imposed upon him would be sought. No such non-indemnification order was sought by the respondent either before the primary judge or on the appeal, in the event that the discretion to re-impose a penalty was exercised. Although we found no appealable error in the primary judge’s imposition of a partial non-indemnification order against Mr Byrnes, that order must necessarily be set aside concurrently with the penalty in question being set aside.
231 However we would, with respect to the primary judge, exercise our discretion differently. We see greater force, than did the primary judge, in the contention that the making of a non-indemnification order in the circumstances just described, would be contrary to the public interest in promoting predictability of outcomes in civil penalty proceedings, including by encouraging cooperation and resolution of disputes of this kind, especially by lesser participants. That is not to say that a judge is in any way bound by private agreements of this kind, but if they are to be departed from by the Court, it may be that in some cases an affected party in a case that is contestable but still compromised needs to be given the opportunity to apply to withdraw an admission of liability and take the case to a liability trial.
232 We have also set aside the penalties imposed on Ms Mallia and Mr Kera and some of the penalties imposed upon Michael Greenfield in respect of which non-indemnification orders were made. There was no challenge to the making of those orders by the primary judge and nothing otherwise suggested by the appellants against the making of non-indemnification orders to accompany any re-imposition of any penalty upon those persons. We see no reason to depart from the approach taken by the primary judge and will make non-indemnification orders in respect of the penalties we re-impose on each of the individual contraveners, other than Mr Byrnes. In making a non-indemnification order against Michael Greenfield, we note that only a proportion of the total of all penalties ordered to be paid was the subject of the non-indemnification order made by the primary judge. We will take essentially the same approach. We will order that each of the re-imposed penalties be the subject of a non-indemnification order, with the result that of the total of $73,000 in penalties to be paid by Michael Greenfield, the sum of $43,000 will be the subject of a non-indemnification order.
Whether penalties should be paid to third parties
233 As stated earlier, the primary judge ordered that certain of the penalties (now to be set aside) be paid to Botany Cranes, Ms Hodges and the NSW Police Force. As a consequence of the penalties being set aside, those orders must also be set aside. However, that circumstance has led us to consider whether we should exercise the discretionary power conferred by s 81(5) of the Act in a way which would maintain the benefit to the persons or organisations concerned of the orders made by the primary judge under that provision.
234 Section 81(5) of the Act provides that a penalty imposed under s 81(1)(a) “is payable to the Commonwealth, or some other person if the court so directs”. The provision reflects s 546(3) of the Fair Work Act which provides that the court may order that “the pecuniary penalty, or a part of the penalty, be paid to … the Commonwealth … a particular organisation … [or] a particular person”.
235 The discretion provided by s 546(3) of the Fair Work Act was the subject of comprehensive consideration by Tracey, Barker and Katzmann JJ in Sayed v Construction, Forestry, Mining and Energy Union (2016) 239 FCR 336 at [58]-[122]. Their Honours there surveyed the authorities which have considered that provision and its legislative predecessors, tracing the provision back to ss 44 and 45 of the Conciliation and Arbitration Act 1904 (Cth). As their Honours observed at [78], what has been conceptualised as the “usual order” reflects a long-standing principle governing the exercise of the discretion to make an order directing the payment of the penalty under s 546(3). The “usual order”, which seems to be a term coined by Gray J in Plancor Pty Ltd v Liquor, Hospitality and Miscellaneous Union (2008) 171 FCR 357, is that save for when the applicant is an inspector, a pecuniary penalty is ordinarily to be paid to the person or organisation applying for the penalty or to an organisation on whose behalf an applicant has applied (see Sayed at [82] and [101]-[102]). The rationale for the “usual order” is that it tends to encourage a “common informer” to police the relevant legislation (see Sayed at [87], [92] and [121]). Furthermore, the Full Court endorsed the observations made by Gray J in Plancor at [42] and [45] that the “usual order” is “not regarded as compensatory in any way” and that there is no suggestion that the legislative intention behind the power to order payment of a penalty to an organisation or person was compensatory. In Sayed at [104] their Honours also made this observation:
In our view, the legislative history of s 546(3), older authority and the terms of the Explanatory Memorandum show that no immediate or obvious connection was intended to be drawn between the exercise of the s 546(3) power and the exercise of the power under s 545 of the FW Act to order compensation.
236 As their Honours noted with approval (at [104]-[112]), the “long and well-understood” operation of the discretion in s 546(3) of the Fair Work Act was preferred by Gilmour J in Woodside Burrup Pty Ltd v Construction, Forestry, Mining and Energy Union (2011) 220 FCR 551, where his Honour construed s 49(5) of the Building and Construction Industry Improvement Act 2005 (Cth), a predecessor provision to s 81(5) of Act, which also provided that “[a] pecuniary penalty is payable to the Commonwealth or some other person if the Court so directs”.
237 Relevantly, at [133]-[134], Gilmour J said:
The power to award payment of a penalty to an applicant, in my opinion, is not intended to compensate a person for losses suffered by the contravention… It is “not regarded as compensatory in any way”… It is a distinct power of a kind historically construed as intended to encourage common informers…
238 Bearing in mind the strong connection between the Act and the Fair Work Act, the long and well accepted application of the discretion provided by s 546(3) of the Fair Work Act and its legislative predecessors, as well as the construction of s 49(5) by Gilmour J to which we have just referred, all of which the legislature may be taken to have known when re-enacting s 81(5), we take the view that we should exercise our discretion consistently with the rationale which underpins the “usual order”. As the penalties to be reimposed were sought by the relevant inspector or regulator, that rationale would require that, ordinarily, the penalties imposed be made payable to the Commonwealth.
239 We accept that extraordinary circumstances may justify the exercise of the discretion in s 546(3) in a manner different to that of the “usual order”. However, no such circumstances are either raised by the representations made by Ms Hodges, the NSW Police Force or Botany Cranes or are otherwise apparent. The only apparent purpose of the orders made by the primary judge in favour of Botany Cranes, Ms Hodges and the NSW Police Force is compensatory. As we have observed above by reference to long-standing authority, the use of s 81(5) for a compensatory purpose is inconsistent with the rationale governing the ordinary exercise of the discretion. We note in that respect that s 81(1)(b) of the Act empowers the Court to make an order “requiring the defendant to pay a specified amount to another person as compensation for damage suffered by the other person as a result of the contravention”. No such orders were sought in the proceeding below. It follows that we decline, in the exercise of discretion, to maintain this aspect of the penalty imposition approach taken by the primary judge and therefore will not remake orders for the payment of any part of the penalties to anyone other than the Commonwealth.
Conclusion
240 For these reasons, we set aside certain of the orders made by the primary judge and re-exercise the penalty discretion as set out above.
I certify that the preceding two hundred and forty (240) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justices Bromberg, Moshinsky and Bromwich. |
Associate:
NSD 579 of 2021 | |
RITA MALLIA | |
Fifth Appellant: | HOWARD BYRNES |
